SBI Cards has reported a positive surprise in Q4FY22 driven by lower credit costs. However, there has also been lower growth in receivables mix. As a business combination, lower revolver with lower credit cost is good but less than optimal. As such, improvement in loan book and revolver mix will be the next earnings levers post normalisation of credit cost (8.4% in FY22). Maintain BUY with a target price of Rs1,060 (unchanged) based on 40x FY24E (FY23/24 earlier) earnings.
Shares of SBI Cards and Payment Services Limited was last trading in BSE at Rs. 820.20 as compared to the previous close of Rs. 829.75. The total number of shares traded during the day was 89941 in over 4509 trades.
The stock hit an intraday high of Rs. 835.00 and intraday low of 806.00. The net turnover during the day was Rs. 73829589.00.