SBI Q4 Results: Net Profit Jumps 83% Beating Estimates
SBI Q4 net profit beat estimates on higher net interest income, lower provisions.
India's largest lender State Bank of India's fourth-quarter net profit surge 83%, beating analysts' estimates on higher core income and lower provisions.
Net profit rose to Rs 16,694 crore for the quarter ended March, compared to Rs 9,114 crore a year ago. Analysts polled by Bloomberg expected a net profit of Rs 14,884 crore.
Net interest income, or core income, rose 29.5% from a year ago to Rs 40,393 crore. Similarly, other income rose to Rs 13,961 crore, up 17.5% year-on-year.
Asset quality for the quarter improved, with the gross non-performing asset ratio falling 36 basis points quarter-on-quarter to 2.78%. Net NPA ratio, too, dropped 10 basis points sequentially to 0.67%.
The bank added fresh slippages worth Rs 3,185 crore during the quarter. In comparison, it saw recovery and upgradation worth Rs 4,200 crore.
Provisions against bad loans for the quarter fell 60% year-on-year to Rs 1,278 crore.
Gross advances as of March 31 stood at Rs 32.69 lakh crore, up 16% year-on-year. This included domestic corporate credit of Rs 9.8 lakh crore, up 12.52% and domestic retail credit of Rs 11.79 lakh crore, up 17.64% year-on-year.
"We expect 12-14% credit growth in FY24. Retail will continue to growth, SMEs also providing opportunities," said Dinesh Khara, chairman, SBI.
On the corporate front the bank is seeing strong traction from roads and renewables sector. Currently the bank has sanctioned loan proposals worth over Rs 1.7 lakh crore, while another Rs 1.75 lakh crore worth proposals are in the pipeline.
Outstanding deposits rose 9.19% from a year ago to Rs 44.23 lakh crore. Term deposits rose to Rs 23.9 lakh crore, up 11.45% year-on-year. Current account savings account deposits, too, rose 4.95% from a year ago to Rs 18.63 lakh crore. The bank's CASA ratio fell to 43.8% at the end of FY23, compared with 45.28% a year before.
"We are currently sitting on excess statutory liquidity ratio securities worth over Rs 4 lakh crore. Deposits will not be a factor affecting credit growth for us," Khara said.
Shares of SBI fell as much 1.4% after the earnings compared with an almost unchanged benchmark Nifty 50. Total traded quantity stood at two times the 30-day average volume. Of the 48 analysts tracking the stock, 47 suggest 'buy' and one maintains 'hold', according to Bloomberg data. The average of 12-month price targets implies a potential upside of 23.8%.
