Result Analysis: State Bank of India (SBI) Q3FY25

Result-Analysis-Elite-Wealth.

State Bank of India (SBI), a Fortune 500 company, is a leading Indian multinational public sector banking and financial services institution headquartered in Mumbai. With a legacy spanning over 200 years, SBI is the most trusted bank in India, serving over 500 million customers. The bank boasts an asset base of over ₹61 trillion and operates through a vast network of 22,500 branches, 63,580 ATMs, and 82,900 BC outlets. SBI’s diversified portfolio includes subsidiaries such as SBI General Insurance, SBI Life Insurance, SBI Mutual Fund, and SBI Card. With a global presence across 241 offices in 29 countries, SBI continues to innovate and deliver sustainable, customer-centric banking solutions, upholding its core values of service, transparency, ethics, and sustainability.

Result Analysis: State Bank Of India (SBI)

(CMP: Rs. 725)

 Result Update: Q3FY25

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    Stock Details
    Market Cap. (Cr.) 6,46,946
    Equity (Cr.) 892.46
    Face Value 1
    52 Wk. high/low 912/680
    BSE Code 500112
    NSE Code SBIN
    Book Value (Rs) 519
    Sector Banks – Public Sector
    Key Ratios
    GNPA (%) 2.07
    NNPA (%): 0.53
    ROE (%): 18.81
    TTM EPS: 81.75
    P/BV: 1.4
    TTM P/E: 8.95
    ROA (%) 1.04
    NIM 3.01

    Result Highlights:

    • The bank reported an Interest Earned of INR 117,426.63 crore in Q3 FY’25, reflecting a 10% growth from INR 106,733.78 crore in Q3 FY’24 on a YoY basis. On a QoQ basis, it increased by 3.12% from INR 113,870.56 crore in Q2 FY’25. Net Interest Income (NII) stood at INR 41,446 crore, up by 4.1% YoY from INR 39,816 crore. However, NII declined by 0.4% QoQ from INR 41,620 crore in Q2 FY’25.
    • The bank reported Total Deposits of INR 5,229,384 crore in Q3 FY’25, reflecting a 9.8% growth from INR 4,762,221 crore in Q3 FY’24 on a YoY basis. On a QoQ basis, deposits increased by 2.19% from INR 5,117,285 crore in Q2 FY’25. Total Advances stood at INR 4,067,752 crore, reflecting a 13.5% YoY increase from INR 3,584,252 crore and a 3.75% growth QoQ from INR 3,920,719 crore in Q2 FY’25.
    • The bank’s Gross Non-Performing Asset (GNPA) ratio stood at 2.07% in Q3 FY’25, down from 2.42% in Q3 FY’24 on a YoY basis. On a QoQ basis, it decreased from 2.13% in Q2 FY’25. The Net Non-Performing Asset (NNPA) ratio stood at 0.53% in Q3 FY’25, improving from 0.64% in Q3 FY’24. The NNPA ratio remained flat QoQ at 0.53% from Q2 FY’25, reflecting improved asset quality.
    • The Provision Coverage Ratio (PCR) stood at 74.66% in Q3 FY’25, an increase from 74.17% in Q3 FY’24 on a YoY basis. However, on a QoQ basis, the PCR slightly decreased from 75.66% in Q2 FY’25. The robust coverage ratio indicates the bank’s prudent provisioning for potential loan losses, ensuring it has adequate reserves to cover non-performing assets, contributing to enhanced financial resilience and asset quality.
    • The bank’s CASA (Current Account Savings Account) ratio stood at 39.20% in Q3 FY’25, lower than 41.18% in Q3 FY’24 on a YoY basis. On a QoQ basis, it decreased from 40.03% in Q2 FY’25. This decline is attributed to the change in deposit composition, but the CASA ratio remains healthy, reflecting a stable core deposit base and low-cost funding, which supports profitability and liquidity management for the bank.

    Financial Performance:

    Shareholding Pattern:

    Particulars (In %) Q3FY25 Q3FY24
    Promoters Group 57.43 57.49
    FIIs 10.27 10.91
    DIIs 24.79 24.15
    Public and others 7.35 7.40
    Government 0.14 0.03

    Management Commentary:

    • The bank has seen a decrease in its SMA1 (Special Mention Accounts 1) category, with a reduction in the number of accounts. However, SMA2 has risen due to a significant account entering the category. Despite this, the bank remains confident that the increase in SMA2 is temporary and that asset quality remains stable.
    • The bank’s NIM outlook remains strong, with a target of maintaining NIMs above 3%. If there is a rate cut, the bank estimates that its NIMs would be affected marginally, but it does not expect a significant negative impact, as the bank’s core focus is on high-quality advances.
    • The bank’s credit cost guidance remains at 50 bps, even amid favorable asset quality trends. The bank has consistently shown an improvement in asset quality over the past five years and remains confident that this positive cycle will continue without significant credit cost increases.

    Outlook:

    State Bank of India (SBI) presents a positive outlook, reflecting strong growth in key financial metrics. With a 10% YoY increase in interest earned and a robust 13.5% growth in total advances, the bank remains well-positioned for sustained profitability. The improvement in asset quality, marked by a decline in GNPA and NNPA ratios, enhances its financial resilience. Despite a slight dip in CASA ratio, the bank’s liquidity and funding remain stable. The management’s confidence in maintaining a healthy Net Interest Margin (NIM) and its stable credit cost guidance further supports an optimistic outlook. SBI continues to show resilience and growth potential for long-term investors.

    Results (Standalone):

    Particulars (In Cr) Q3FY25 Q2FY25 Q3FY24 QoQ% YoY % FY24 FY23 YoY %
    Interest Earned 124653.66 121044.68 112868.34 3.0 10.4 439188.5 350844.59 25.2
    Other Income 43199.91 42757.7 40203.3 1.0 7.5 155386.39 122533.56 26.8
    Total Income 167853.56 163802.38 153071.64 2.5 9.7 594574.88 473378.13 25.6
    Operating Expenses 140288.98 130742.23 136381.55 7.3 2.9 495629.89 379795.3 30.5
    Operating Profit Before Prov. & Cont. 27564.59 33060.15 16690.09 -16.6 65.2 98945.02 93582.84 5.7
    Provisions & Contingencies 1998.19 5585.84 1445.25 -64.2 38.3 7704.97 18184.28 -57.6
    EBT 25566.4 27474.31 15244.83 -6.9 67.7 91240.04 75398.56 21
    Provision for Taxes 6391.05 7254.69 3962.17 -11.9 61.3 23101.78 18840.13 22.6
    Net Profit 19175.35 20219.62 11282.66 -5.2 70.0 68138.26 56558.43 20.5

    Segment Revenue (Standalone):

     

    Particulars (In Cr) Q3FY25 Q2FY25 Q3FY24 QoQ% YoY %
    Treasury  Operations 30852.47 34039.09 32224.44 -9.4 -4.3
    Corporate/Wholesale Banking Operations 35954.13 36905.89 32715.65 -2.6 9.9
    Retail Banking Operations:
    a) Digital Banking 1338.72 1382.62 1321.94 -3.2 1.3
    b) Other Retail Banking 60082.77 56813.51 51190.31 5.8 17.4

    Segment Revenue (Consolidated):

    Particulars (In Cr) Q3FY25 Q2FY25 Q3FY24 QoQ% YoY %
    Treasury  Operations 30852.47 34039.09 32224.44 -9.4 -4.3
    Corporate/Wholesale Banking Operations 35954.13 36905.89 32715.65 -2.6 9.9
    Retail Banking Operations:
    a) Digital Banking 1338.72 1382.62 1321.94 -3.2 1.3
    b) Other Retail Banking 60082.77 56813.51 51190.31 5.8 17.4
    Insurance Business 32264.61 28158.68 28491.9 14.6 13.2
    Other Banking operations 7624.57 8068.82 7266.03 -5.5 4.9
    Unallocated 250.39 11.11 750.81 2153.7 -66.7

    Balance Sheet (Standalone):

    Particulars (In Cr) Q3FY25 Q2FY25 Q3FY24 QoQ% YoY %
    Capital and Liabilities
    a) Capital 892.46 892.46 892.46 0 0
    b) Reserves & Surplus 434513.91 368061.45 376354.07 18.1 15.5
    c) Deposits 5229384.48 4762220.69 4916076.77 9.8 6.4
    d) Borrowings 709135.25 552488.92 552488.92 28.4 28.4
    e) Other liabilities and Provisions 246748.34 281952.77 288809.73 -12.5 -14.6
    Total 6620674.44 5965616.29 6134621.95 11.0 7.9
    Assets
    a) Cash and balances with RBI 233683.87 211029.32 225141.7 10.7 3.8
    b) Balances with banks and money at call and short notice 102581.73 56152.15 85660.29 82.7 19.8
    c) Investments 1808628.94 1689406.3 1671339.66 7.1 8.2
    d) Advances 4004566.94 3519514.28 3703970.85 13.8 8.1
    e) Fixed assets 43389.23 42501.36 42617.25 2.1 1.8
    f) Other assets 427823.73 447012.88 450964.19 -4.3 -5.1
    Total 6620674.44 5965616.29 6179693.94 11.0 7.1
    Source: Company website, EWL Research

     

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