Buy State Bank of India, target of Rs 1950: Karvy

Karvy Stock Broking has recommended a buy rating on State Bank of India with a target price of Rs 1950 in its July 25, 2008 research report. "During 1st Q FY09, we expect that the bank would report 28% (Y-o-Y) growth in advances and 24% (Y-o-Y) growth in deposits; NII is expected to report 8% growth (Y-o-Y) to Rs 48.5 billion; we expect that the bank's margin would be under pressure."

"We estimate 11% growth in bottomline to Rs 15.8 billion mainly on account of higher investment depreciation provisions of Rs 6.2 billion and marginally lesser loan-losses provisions. At current price, the stock quotes at 1.5x adjusted book value FY2010; we rate the stock as a BUY with a price target of Rs 1950 at 1.8x adjusted book value FY2010," says Karvy's research report.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

For further details click on attachment......