SBI share price gains after Q1 results; here is why analysts see 24% to 32% more upside

livemint.com:

SBI share price gained as much as 1.13% in the early trade to ₹579.75 apiece on the BSE. However, SBI shares failed to hold gains and fell from the day’s high to trade nearly a percent lower. SBI Q1 net profit jumped 178.25% YoY to ₹16,884 crore.

Its net interest income (NII) in April to June 2023 quarter rose 24.71% YoY, while domestic net interest margin (NIM) increased by 24 bps YoY to 3.47%. Read here: SBI Q1 results 2023: Net profit jumps 178% to ₹16,884 crores, NII rises 24.71%. Stock dips 3% Brokerages maintained their positive stance on SBI stock and expected more upside for the SBI share price in the range of 24% to 32%.

Here’s what brokerages said on SBI Q1 results and SBI share price: SBI delivered a mixed quarter with NII missing estimates, led by margin contraction, while higher treasury income drove earnings beat. Business growth remains modest in a seasonally weak quarter and the bank expects to gain healthy traction in the coming quarters. A higher mix of floating loans (MCLR), which could benefit further from re-pricing will continue to support the NII and overall earnings even as the deposit cost could increase, the brokerage firm said.

It estimates SBI to deliver FY25 RoA and RoE of 1.0% and 17.8%. The brokerage reiterated its ‘Buy’ rating with an unchanged target price of ₹700 per share. SBI posted a mixed bag of results with the highest-ever quarterly earnings again, led by lower opex and credit costs.