SBI on a new high

SBI is the bright star today morning figuring among the top five gainers on the BSE. The stock, which had closed yesterday at Rs.355.10, it rose 15% hit a new high at Rs.408.35 on the back of very robust volumes.

The market is super thrilled with its earnings for Q3FY21 as it indicates improving asset quality, fewer fresh slippages.

SBI’s Gross NPA for the quarter came down to 4.77% v/s 5.28% (QoQ) while Net NPA improved from 1.6% to 1.23%. And in the absence of the Supreme Court's order, the GNPA and NNPA would have been at 5.44% and 1.81% respectively."

In terms of fresh slippages, there was a 98.5% (YoY) and 91% (QoQ) drop at Rs.237 crore. Foreign brokerage CLSA put out a note stating that SBI will now be able to contain total restructured loans well within its guidance of Rs 60,000 crore for the whole fiscal year.

On the earnings front, it reported a 7% (YoY) drop and up 14% (QoQ) in standalone net profit at Rs.5196 crore.

Excluding the one-off interest income and other income during Q3FY20, the YoY growth in net profit and operating profit for Q3FY21 would be 134% and 26% respectively.

Total provisions for the quarter were Rs 10,342 crore v/s Rs.7253 crore (YoY), of which provisions for NPA were Rs 2,290 crore v/s Rs.8193 crore. At the end of Q3FY21, the bank held total Covid-19 related provisions worth Rs 12,976 crore.

Provision Coverage Ratio improved to 90.21%, up 848 bps (YoY) and 202 bps (QoQ).