- 05 Feb 2024
- ICICI Securities
SBI Q3 RESULTS 2024: REPORTED HEALTHY PERFORMANCE IN Q3FY24
SBIN - 779 Change: 10.25 (1.33 %)News: SBI reported healthy performance in Q3FY24, while optically earnings were marred by one-time provisions during the quarter. Business growth remained healthy both on advances (+14.4% YoY) and deposits (+13.02% YoY) with continued focus on retail loans and term deposits. Slippages came higher sequentially at ~67 bps, however, steady trajectory with below 1% accretion provides comfort. GNPA witnessed continued decline at 2.42% (-13 bps QoQ). Margins declined ~9 bps QoQ at 3.34%, resulting in 4.6% YoY growth in NII. Earnings declined 36% YoY to ₹ 9164 crore, owing to one-time expense of ₹7100 crore (₹1700 related to dearness allowance and ₹5400 crore on account of uniform pension liability) and additional provision for wage revision at ₹ 6313 crore.
Views: Earnings impacted due to one-time expense; excluding the same RoA would be at 1.06% (reported RoA at 0.8%). Management has indicated growth to remain healthy. Margins seen to remain steady with maximum decline of 2-3 bps in Q4FY24. Additional provision related to wage revision expected in Q4FY24. Continued business growth, steady margins and benign credit cost to support RoA, though volatility in opex is expected to drive valuation gradually.
Impact: Neutral