SBI share price today has followed the wider markets into the re and is at Rs 352, down Rs 19 or 5%. SBI performance over the week has seen it move down by 1.5%, from Rs 357.5 to Rs 352. In its report today, Sharekhan says State Bank of India (SBI) is attractive (with respect to asset quality, capitalisation, underwriting strength) and going forward, it expects NII and profitability to reflect in the next 2-3 years.
 
According to Sharekhan, recovery trends indicate a gradual but sustained pickup in economic activity, and SBI, by virtue of being the largest bank, with strong business strengths (market maker in terms of deposit rates; margins protected) is attractively placed. Moreover, the bank’ strong asset-quality position indicates better profitability in the medium term, which will help reflate NII and earnings.
 

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SBI Technical Analysis:
 
Ashis Biswas, Head of Technical Research at CapitalVia Global Research has revealed trading strategy in SBI. He said it is likely to hold above the Rs 340 level. The stock is trading close to its long-term support. He added that investors can look for a low-risk entry point at the current market level of around Rs 350-355. SBI has been trading in an upward trend, and the positive momentum is likely to continue. Ashis says he expects a bounce-back in the stock and so he recommended a buy on SBI above Rs 365. He expects the stock to gain momentum and advised investors to maintain the Target of Rs 430 with a Stop-Loss of Rs 330 for a short-term period.
 
SBI Asset Quality:
 
1. GNPA/ NNPA stood at 5.44% /1.81% against reported GNPA of 4.77% and NNPA of 1.23%, indicating well-contained book quality. 

2. Provision coverage ratio (PCR) has improved to whopping 90.21% and, notably, with collection efficiency at 96.5%, Sharekhan expects full-year slippages to be well within management’s guidance of Rs 60000 cr (so far only Rs 41216 crore done). 

3. SBI’s retail asset quality has been robust (<50 bps credit costs) over the last decade and, with the end of the corporate credit cycle, SBI’s asset quality is finally emerging from the shadows to deliver better asset-quality outcomes. 

4. As the economy is expected to revert to strong growth in FY2022E and beyond, banks and industry leaders such as SBI are well placed to capitalise on the opportunity.