Religare's research report on SBISBIN posted a disappointing Q3FY16 with PAT tumbling 61% QoQ to Rs 11.2bn on mounting provisions. Slippages climbed to Rs 206bn (Q2: Rs 59bn) with ~70% of these stemming from RBI’s asset quality review cases. The bank refinanced accounts worth Rs 77bn under 5:25 and evoked SDR on 12 accounts of Rs 84bn. We slash FY16E-FY18E earnings by ~30% citing higher credit costs. With asset quality pressures unlikely to wane, we maintain SELL with a Mar’17 TP of Rs 150 (Sep’16 TP of Rs 210 earlier).We cut FY16E-FY18E earnings by ~30% to factor in the increase in credit costs. Maintain SELL with a Mar’17 TP of Rs 150 (rolled over from a Sep’16 TP of Rs 210). For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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