State Bank of India - Q4 FY21 Result Update - YES Securities

(Rating: BUY, TP: Rs 538, Upside: 34.0%)

SBI has made a sure-footed move to a higher return ratio trajectory

- Significantly lower slippages than guidance augur well from an asset quality standpoint.

- Sequential margin shrinkage is optical since, adjusted for interest reversals and 'interest on interest' refund, NII would have expanded 4.2% sequentially.

- Retail loan growth at SBI was driven by 'other' retail loans i.e. mainly unsecured personal loans and gold loans.

- Maintain BUY as we value the standalone bank at 1.0x FY23 P/BV for an FY22E/23E RoE profile of 11.2%/13.5%. We assign a value of Rs 177 per share to the subsidiaries on the basis of SOTP.

Shares of STATE BANK OF INDIA was last trading in BSE at Rs.412.05 as compared to the previous close of Rs. 401.1. The total number of shares traded during the day was 6879567 in over 72462 trades.

The stock hit an intraday high of Rs. 418.9 and intraday low of 405.3. The net turnover during the day was Rs. 2832490381.

Source : Equity Bulls

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