SBI Q1 net may rise 1.5% at Rs 3806 cr: Motilal Oswal
Motilal Oswal expects State Bank of India to report a 15.4 percent growth quarter-on-quarter (rise of 1.5 percent year-on-year) in net profit at Rs 3,806.3 crore.
August 08, 2013 / 07:17 PM IST
Motilal Oswal has come out with its first quarter (April-June) earnings estimates for the banking sector. The brokerage house expects State Bank of India to report a 15.4 percent growth quarter-on-quarter (rise of 1.5 percent year-on-year) in net profit at Rs 3,806.3 crore.
Net interest income is expected to increase by 5.6 percent Q-o-Q (up 5.2 percent Y-o-Y) to Rs 11,702.7 crore, according to Motilal Oswal.
Motilal Oswal report on State Bank of India
Loan growth is expected to remain healthy at 17 percent Y-o-Y, while deposit growth is expected to be lower at 10 percent Y-o-Y.
Fee income growth is expected to be flat. However, higher trading gains would help non-interest income to grow by 10 percent+ Y-o-Y.
Weak core income growth and higher opex is expected to result in flat PPP growth on a Y-o-Y basis.
On a sequential basis, net slippages are expected to increase - partially seasonal in nature. Thus, we factor net slippage ratio of 1.2 percent and credit cost of 1 percent. MTM write-back may help contain overall provisions.
Hence, we expect PAT to be flat Y-o-Y at INR 38 billion.
The stock trades at 0.8x FY15E consol BV (ex- insurance) and 6.2x FY15E EPS.