Limited downside seen in SBI: Dilip Bhat

Bhat told CNBC-TV18, “State Bank of India (SBI) numbers has been a huge disappointment without any doubt both in terms of the gross slippages which is almost at 11,000 crore, even the provisioning which has come down. I think the outstanding feature of SBI always was the NIMs, which has given away in this particular quarter.”

He further added, “All in all a bad set of numbers but one may well argue that it’s already there in the price but there are couple of things out here that the confidence which was coming back into the PSU banks now will take a backseat and nobody will be in a hurry especially given the inclement economic environment that we are in at the moment and also probably it means that its certainly for the peer banking stocks especially the PSU peer banking stocks- it’s a bad news. So I think I would still not be in a hurry to buy SBI. I will still wait for the prices to correct and even if I want to buy I will buy very gradually over next 10-12 months. But at the moment I will still wait and watch and not be in a hurry.”

“The way SBI has come down maybe it is really available at a very attractive price to adjusted book value, so maybe the downside will be very nominal. But more important is that it probably will continue to languish and maybe there could be some short-term buying here and there. But I don’t think that on a sustainable-basis it can see a price sustainable beyond Rs 2,000. So maybe the downside is not much, but still the upside will always remain a question mark.”