India’s largest lender, State Bank of India (SBI), is expected to report a weak performance for the March quarter (Q4FY25) because of lower treasury income and a decline in margins. The state-owned bank is scheduled to announce its Q4 results on May 3, 2025.
According to Moneycontrol's poll, SBI’s net interest income (NII) is likely to grow modestly by 5.3 percent year-on-year (YoY) to Rs 43,872 crore in Q4FY25, up from Rs 41,655 crore in the same quarter last year. However, the bank’s profit is expected to fall sharply by 13 percent YoY to Rs 17,971 crore in Q4FY25, compared to Rs 20,698 crore in Q4FY24.
Estimates of analysts polled by Moneycontrol are shown to be in a diverse range, meaning any positive or negative surprises may elicit a sharp reaction in the stock price. Among the brokerages polled, IIFL Capital rolled out the most bullish projections while Kotak Institutional Equities forecasted the slowest growth for SBI.
What factors are driving the earnings?
Margin compression: Analysts at Kotak Institutional Equities expect SBI’s net interest margins (NIMs) to decline by up to 34 basis points YoY, from 3 percent in Q4FY24 to 2.6 percent in Q4FY25. This is mainly due to the rising cost of funds and the impact of recent interest rate cuts.
Stable asset quality: Analysts at Phillip Capital believe SBI will maintain stable asset quality in the March quarter, with no new issues seen in its unsecured loan portfolio. The net non-performing asset (NNPA) ratio is expected to stay at 0.5 percent in Q4FY25, the same as in the previous quarter.
Healthy loan growth: According to analysts at Mirae Asset Sharekhan, SBI’s loan growth is expected to remain strong at around 13 percent YoY in Q4FY25.
What to look out for in the quarterly show?
Investors will pay close attention to the management’s commentary on the margin outlook for FY26, as well as the bank’s return on equity (RoE) and capital adequacy ratio (CAR) for the quarter.
During the January–March period, shares of SBI declined by 3 percent, underperforming the Nifty 50 index, which rose by 3 percent during the same timeframe.
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