- 05 Aug 2024
- ICICI Securities
SBI delivered another steady quarter
SBIN - 783 Change: -1.60 (-0.20 %)News: SBI delivered another steady quarter with earnings remaining flat YoY due to higher provision and accounting norms on investment. Growth in advances came at 15.4% YoY to ₹ 38.1 lakh crore, backed by growth across portfolio. Within retail segment, auto (16.6%) and personal loans (20.5%) witnessed healthy traction, while pace in Xpress credit saw marginal moderation. Deposit accretion came at 8.2% YoY, with CASA at 40.7%. Asset quality remained steady with 3 bps QoQ improvement in GNPA at 2.21%, while slippages remained a tad higher at 84 bps, led by ageing and temporary slippages from unsecured book. Operationally, NII increased 5.7% YoY, amid decline in margins (-6 bps QoQ) at 3.22%, other income was impacted due to accounting norms on treasury. Thus, operating profit increased 4.5% YoY, however, higher provisions kept earnings flat at ₹ 17035 crore.
Views: Continued delivery on growth and asset quality bodes well. Volatility seen in earnings owing to impact of alteration in accounting norms. RoA continued to remain at 1.1%. Optimistic outlook on growth (healthy credit pipeline), steady margins (CD ratio at 69% remains lever to safeguard NIM) and asset quality (reversal seen in Xpress credit slippages) is seen to aid valuation ahead.
Impact: Positive