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Buy State Bank of India; target of Rs 700: Motilal Oswal
Motilal Oswal is bullish on State Bank of India recommended buy rating on the stock with a target price of Rs 700 in its research report dated June 17, 2023. Motilal Oswal's research report on State Bank of India State Bank of India’s (SBIN) FY23 annual report high lights that the bank is steadily strengthening its balance sheet and consistently delivering healthy RoE while maintaining its leadership position. The bank continues to focus on building a superior loan book, as evident in a steady decline in stressed assets, improving PCR and robust loan growth (17% in FY23). The Retail segment reported a 2.5x jump in PBT after the Corporate segment showed a 5x increase in PBT in FY22. SBIN has delivered an earnings CAGR of 51% over FY20-23 and crossed a key milestone of INR500b of profits in FY23. On the digital front, YONO continued to set new records with ~143m downloads and ~60m registered users, along with average daily logins of ~10.3m. SBIN sanctioned 1.39m digital loans worth INR243b and opened 64% of savings accounts through YONO in FY23. Outlook SBIN reported further improvement in asset quality, with PCR improving to 76% (98.6% on the corporate book) in FY23. Controlled restructuring (0.8%), low SMA pool (10bp) and 100% coverage on SR portfolio provide comfort and would keep credit costs under control. We reiterate BUY with a TP of INR700. Source - Money Control
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