Fri Feb 07 04:00:00 UTC 2025: ## SBI’s Mixed Q3 Results Lead to Lower Target Prices

**Mumbai, India** – State Bank of India (SBI) announced mixed quarterly results on Thursday, sending its share price down 1.79 percent to close at Rs 752.35 on the BSE. While lower provisions boosted profitability, the bank’s net interest margin (NIM) moderated, and other income fell short of analyst expectations due to lower treasury income. This prompted several brokerages to revise their target prices downward.

Although Q3 credit growth remained healthy at 13.8 percent year-on-year (YoY), growth in the unsecured Xpress Credit portfolio slowed. Deposit growth was modest, and the Current and Savings Account (CASA) ratio continued to decline, reaching 37.6 percent. However, positive aspects included contained fresh slippages and credit costs, reflecting improved underwriting standards. The restructured book remained low at 0.34 percent of advances.

Brokerage houses offered varied assessments. While maintaining “Buy” recommendations, MOFSL lowered its FY26-FY27 earnings estimates and set a target price of Rs 925, HDFC Institutional Equities retained its “Buy” rating but lowered its target price to Rs 1050. Nirmal Bang Institutional Equities also maintained a “Buy” recommendation with a revised target price of Rs 1016.

Despite the mixed results, SBI management expressed confidence, projecting 14-16 percent loan growth for FY25, a rebound in Xpress Credit, double-digit deposit growth, a stable NIM above 3 percent, and an RoA of at least 1 percent. The bank expects overall deposit growth of 10 percent YoY. The long-term outlook remains positive, citing SBI’s leadership position in corporate and retail banking and strong asset quality.

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