SBI Card share price falls 4% after Q1 results; brokerages express mixed views

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₹842 against the previous close of ₹856.50 and fell 3.6 per cent to ₹825.30 soon on BSE. After market hours on Friday (July 28), SBI Card reported its consolidated net profit fell 5 per cent to ₹593 crore, compared to ₹626.9 crore in the corresponding period last year. Revenue from operations increased 24 per cent to ₹4,046 crore, compared to ₹3,263 crore in the year-ago period while interest income increased by 30 per cent at ₹1,804 crore in Q1FY24, compared to ₹1,387 crore in Q1FY23.

The net interest margins of the company stood at 11.5 per cent, down 176 basis points (bps). Fees and commission income increased 23 per cent at ₹1,898 crore in Q1 FY24, against ₹1,538 crore in Q1FY23. Read more: SBI Card Q1 Results: Net profit falls 5% to ₹593 crore, revenue up 26% Brokerage firms expressed diverse views on the stock after the Q1 earnings.

Some brokerage firms lowered their estimates for SBI Card after the company's Q1 results, resulting in rating downgrades and cuts in target prices. Brokerage firmEmkay Global Financial Servicesdowngraded the stock to a 'hold' from a 'buy' and cut the target price to ₹950 from ₹1,000, implying 5.8 times its June-25 ABV (adjusted book value) and 25 times EPS (earnings per share). "Factoring in operational softness in business/fees and NPAs, we have lowered our earnings estimates for FY24-26E by 4-8 times and RoA (return on assets) and RoE (return on equity) expectations to 5 per cent and 24-25 per cent, respectively," said the brokerage firm.