State Bank of India (SBI) is expected to report strong growth in its second-quarter net profit, supported by higher interest and other income. Gains from the sale of stakes in SBI Mutual Fund and the National Stock Exchange (NSE) are also likely to boost earnings.
Consensus estimates from brokerage firms suggest that SBI's net profit could rise around 45 per cent year-on-year (YoY) in Q2. However, estimates vary widely, ranging from 16.6 per cent to 50.5 per cent. The bank is scheduled to announce its Q2 results later today.
Key Highlights:
- SBI's net profit is expected to increase around 45 per cent YoY in Q2.
- Motilal Oswal projects 50.5 per cent profit growth to ₹25,250 crore.
- Systematix expects a 16.6 per cent increase in net profit to ₹23,539 crore.
Motilal Oswal Expects 50.5% Growth in SBI Net Profit
Motilal Oswal Financial Services expects SBI's net profit to increase 50.5 per cent YoY to ₹25,250 crore. The brokerage attributed the expected growth to strong business expansion and gains from stake sales in SBI Mutual Fund (SBIMF) and NSE.
The brokerage estimates that the bank's net interest income (NII) will grow 11.3 per cent YoY to ₹47,847 crore.
It also expects advances to grow 18.9 per cent, compared with 13.1 per cent in Q1FY27. Deposit growth is projected at 12.1 per cent, against 9.3 per cent in the previous quarter.
However, SBI's net interest margin (NIM) could moderate to 2.83 per cent. This represents a decline of 14 basis points from 2.97 per cent recorded a year ago.
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Systematix Projects 16.6% Rise in Net Profit
Systematix Shares and Stocks (India) Ltd has estimated a more moderate increase in SBI's net profit at 16.6 per cent YoY to ₹23,539 crore. The brokerage expects NII to grow 9.6 per cent YoY to ₹47,122 crore. Meanwhile, other income is projected to increase 49 per cent to ₹22,833 crore.
Systematix expects total other income to benefit from a one-time gain of ₹1,020 crore through the sale of SBIMF and NSE shares. However, the brokerage also flagged the possibility of higher credit costs. It believes SBI could use these one-off gains to strengthen its provision buffers.
The bank's Q2 results will provide further clarity on its earnings performance, interest margins and asset quality.
