On consolidated basis, SBI pips other index heavyweights to become most profitable company in Q2 so far

SBI becomes most profitable company in Q2: India’s largest lender State Bank of India (SBI) has become the country's most profitable corporate on a consolidated basis in the July-September quarter of the financial year 2022-23 (Q2FY23), beating the index heavyweight Reliance Industries Limited (RIL).

On a consolidated basis, SBI, which is the seventh largest company in terms of market capitalisation, reported a net profit of Rs 14,752 crore as compared to Reliance, the largest company with respect to market cap, profit of Rs 13,656 crore during the second quarter of FY23.

State-owned SBI reported a net profit of Rs 13,256 crore, up nearly 74 per cent year-on-year growth on a standalone basis, making this the best-ever quarterly numbers for the bank and beating all other usually more profitable companies by a wider margin.

Also Read: SBI share price jumps 4% on upgrades from top brokerages, strong September quarter results

SBI beat Mukesh Ambani’s firm, which remained the most profitable corporate for decades, by a wider margin as the oil-to-telecom conglomerate took a hit of Rs 4,039 crore in windfall tax on its exports during the quarter.

The net income of Reliance Industries includes Rs 4,729 crore from Jio Platforms and Rs 4,404 crore from the retail business, both pre-tax earnings, which was marginally down from Rs 13,680 crore in the year-ago period.

SBI chairman Dinesh Kumar Khara said that had the bank booked treasury profits in the quarter, net income would have been much higher. He did not quantify by how much, though.

Also Read: SBI Q2FY23 Results: Net profit jumps nearly 74% YoY on improved asset quality and higher loans – check highlights here

Unlike all other banks, the chairman said the bank has had notional gains on its treasury investments, which has a Rs 2.85 trillion of additional exposure than the mandated 19 per cent in SLR or statutory liquidity ratio.

The Reserve Bank mandates all banks to invest 19 per cent of their total deposits in central government securities.

When compared to other banks, especially SBI's peers, the most profitable and the second largest lender HDFC Bank is way behind with a net income of only Rs 11,125 crore, which rose 22.3 per cent in the quarter.

Traditionally, the second most profitable company has been the software major TCS (Tata Consultancy Services), which reported a Rs 10,431 crore net this time around on a revenue of Rs 55,309 crore.

The state-owned oil and gas major ONGC is yet to report its second quarter numbers but had its best-ever numbers of Rs 15,205.85 crore in the first quarter when the oil and gas prices were high and the same is unlikely to be repeated this quarter given the fall in crude prices.

With PTI Inputs