SBI Q4 preview: Brokerages expect strong profit on lower provisions, higher NII

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26 Aug, 2025 12:21

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The country's largest lender State Bank of India (SBI) is likely to report profit in the March quarter with double-digit growth in net interest income and lower provisions.

The state-owned lender will report the numbers on May 10.

Most brokerages expect profit in the range of Rs 5,000-7,000 crore for the quarter against a loss of Rs 7,718.2 crore in the same period last year.

"PAT is expected to grow at the rate of 53 percent QoQ to Rs 6,034 crore," Narnolia Securities said, while Kotak said it expects the same to increase by 70 percent QoQ to Rs 6,759.4 crore for the quarter.

Double-digit loan growth with steady net interest margin may help net interest income grow in double digits, brokerages said.

"We expect loan growth at steady 11-12 percent YoY with largely steady NIMs leading to 16-17 percent NII growth," Prabhudas Lilladher said.

Motilal Oswal expects loan growth of 11 percent YoY, led by growth in retail books and portfolio buyouts. Deposit growth is expected to come in at
8 percent YoY, it added.

NII is expected to increase 15 percent YoY due to lower interest reversals and better recoveries from written off accounts, the brokerage said, adding non-interest income is expected to decline YoY but increase QoQ on account of an improvement in the treasury performance and fee income.

Asset quality is expected to improve sequentially with slippages either likely to be steady or lower compared to the previous quarter.

"Asset quality should improve as we expect very similar slippages as seen in Q3FY19 but do not see recent announced resolutions factoring in this
quarter. We expect bank will continue to enhance PCR," Prabhudas Lilladher said.

Kotak said slippages will decline to below 2.5 percent as recognition is complete while gross NPLs could decline with resolution/NPL sales to asset reconstruction companies.

Motilal Oswal also feels stress addition is likely to moderate to 1.9 percent, as it believes that most of the stress has been recorded in previous quarters.

Key issues to watch out for would be updates on the retail, SME and agri slippages; recoveries from resolution of NCLT accounts; outlook on power assets and macro developments on asset quality.