MC EXCLUSIVE SBI eyes spot among top 10 global banks by market cap in 5 years: Chairman CS Setty

SBI chairman CS Setty

The State Bank of India (SBI) aims to rank among the top 10 global banks by market capitalisation within the next five years, said Chairman CS Setty, speaking to Moneycontrol at the listing event of its Qualified Institutional Placement (QIP).

“Our long-term objective is that in the next five years, we position ourselves in the top ten global banks in the market cap,” Setty said. He added, “It is not only the largest QIP, I understand from the NSE that it is also the largest equity issue ever in the Indian market.”

The issue attracted demand four times higher than the Rs 25,000 crore on offer, making it the largest equity issuance ever by an Indian company, according to the National Stock Exchange.

Foreign investors accounted for 64.3 percent of total demand, underscoring the continued attractiveness of India’s economic and financial growth story. Marquee long-term investors received approximately 88 percent of the final allocation, including 24 percent of the total issue size placed with foreign long-term investors.

Reflecting on the reception, Setty said, “Obviously, 4x is beyond what we expected. We knew that it will be oversubscribed. There will be a good response, but this kind of overwhelming response is a pleasant surprise for us.”

The capital raised through the QIP will help bolster SBI’s Common Equity Tier-1 (CET-1) capital buffer, which is expected to improve to around 11.50 percent from 10.81 percent as of March 31, 2025. This strengthened capital position will support calibrated credit growth across the retail, MSME, and corporate segments.

This QIP comes at a time when public sector banks have been working to shed concerns over asset quality.

Setty attributed the investor interest to SBI’s consistent engagement with both domestic and international investors. “Whether we had gone to the market or not, our engagement with investors always has been there,” he said. “Every quarterly result, we engaged. So the investor understanding of SBI was very good.”

“There is a good amount of interest in Indian equities in general, and SBI in particular,” he said, adding that the bank views this as a sign of increasing global confidence in India’s growth story.

When asked about valuations, Setty acknowledged SBI has reached a price-to-book ratio of 1.7x, which is an improvement from earlier levels, but also maintained that the bank does not chase valuation metrics in isolation.

“It is a market dynamic,” he said. “But our objective is that, as I mentioned, three principles: consistency in our performance, productivity gains, and what we use, both at the employee side and the technology side, and the resilience of the operation, so that the customers will always continue to be served.”

Setty declined to comment or give any growth guidance, as the bank is in its silent period ahead of earnings.

The upgrade of the bank's baseline credit assessment (BCA), according to Moody’s is driven by expectation that the bank's internal capital  generation along with opportunistic external capital raise will improve its capitalization over the next 12-18 months, bringing its standalone credit profile in line with the other similarly rated peers.