SBI Q1 Review: State Bank of India’s Q1 performance was broadly in line with expectations, with net interest income (NII) growing less than 1% QoQ. A sharp 55% YoY jump in other income aided operating profit, which beat Street estimates by 11%.
Provisioning was in line with analysts’ forecasts, while profitability received a boost from other income. Q1 was marked by steady core performance, a sharp boost from treasury gains, and a largely stable asset quality.
SBI Q1 Review: Brokerage calls, analysis for SBI post Q1 results
Macquarie – Underperform, TP Rs.720
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Macquarie flagged that the PAT beat was largely driven by higher treasury gains.
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It expects normalization of credit costs and limited treasury support in coming quarters, calling these key monitorable.
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Credit cost rose to 47 bps vs 39 bps in Q4, due to higher slippages.
DAM Capital – Maintains BUY, TP Rs.940 (from Rs.930)
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DAM said the quarter was in line
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Operational performance slightly better than expected.
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Loan growth of 12% YoY outpaced industry
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Higher MCLR book supported yields versus peers.
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Provisions were broadly in line with NPA credit costs.
Jefferies – Maintains BUY, TP Rs.970
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Jefferies viewed Q1 as a good start, with largely stable asset quality and steady loan growth.
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NPLs remained low in retail unsecured (0.8%) and SME (3.3%), though higher in agri (8.7%).
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Expects some NIM pressure from policy rate cuts and recent capital raise.
Dolat Capital – Maintains BUY, TP Rs.950
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DC called it a steady show with asset quality holding up.
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Slippages stood at 0.8%, credit cost at 50 bps.
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It flagged cyclical NIM pressures in the near term, but continues to factor 50 bps credit cost for FY26-27E vs 40 bps in FY25.
Systematix – Maintains BUY, TP Rs.1,020 (earlier Rs.1,027)
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Systematix noted gross slippages rose sequentially on seasonal weakness
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Advances and deposits growth stayed healthy.
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NIM moved lower, but operating expenses surprised positively.
Investec – Maintains BUY, TP Rs.940 (from Rs.920)
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Investec praised the solid operational and asset quality performance.
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Management remains confident of delivering 1% RoA and 15% RoE through the cycle.
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Loan growth outlook is strong on liquidity and corporate pipeline, prompting PAT upgrades.
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Revise FY26/27E PAT estimates upwards by 3/1% on account of higher treasury income and lower opex
B&K – Maintains BUY, TP Rs.925
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B&K said operating performance was in line
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Stable asset quality and better cost ratios.
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It sees NIM recovering in 2HFY26 from deposit repricing
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Raised PAT estimates by 9%/6% for FY26/27E.
Nuvama- Maintains BUY, TP Rs.950
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Nuvama noted core NIM fell only 2 bps QoQ, better than peers.
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It expects NIM to dip in Q2 before improving in H2FY26 on deposit repricing and capital raise.
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Xpress credit growth is likely to pick up from Q2
Takeaways
While most brokerages remain bullish with price targets in the Rs.925–Rs.1,020 range, Macquarie stands out with an Underperform call. The street expects near-term NIM pressures, but strong loan growth, healthy deposit momentum, and improving credit demand are seen supporting performance in the second half of FY2
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