SBI Q1 Results Exceed Expectations; Brokerages Hike Target Price to Rs 955

State Bank of India (SBI) reported a 12% YoY rise in standalone net profit for Q1FY26, surpassing Street estimates. Brokerages raised the stock's target price as high as Rs 955. SBI's profit for the quarter stood at Rs 19,160 crore, up from Rs 17,035 crore in the corresponding period last year. The bank's interest income rose 6% to Rs 1,17,996 crore during the quarter.

State Bank of India (SBI) reported a 12% year-on-year (YoY) rise in its standalone net profit for the June quarter, Q1FY26, standing at Rs 19,160 crore. This figure exceeded Street estimates, which had pegged it at Rs 17,095 crore. The bank's interest income grew by 6% to Rs 1,17,996 crore during the quarter, while interest expenses rose by 9% to Rs 76,923 crore.

The earnings were announced during market hours, and SBI shares recovered from the day’s low of Rs 793 on NSE, though they were still trading over 1% lower around 1:30 pm amid weak market sentiment. The net profit growth was driven by efficiency in operating income and contained operating expenses.

SBI's operating profit rose by 15% from Rs 26,449 crore in Q1FY25 to Rs 30,544 crore in Q1FY26. Gross advances stood at Rs 42.54 lakh crore in Q1FY26, up 12% from Rs 38.12 lakh crore. The retail personal loan portfolio jumped 13% to Rs 15.39 lakh crore, while the agriculture segment also rose 13% to Rs 3.5 lakh crore. The SME and corporate segments recorded growth of 19% and 5.7% YoY, respectively.

SBI's total deposits grew 12%, from Rs 49.01 lakh crore in Q1FY25 to Rs 54.73 lakh crore. The Provisioning Coverage Ratio (PCR) was reported at 74.49%. Net NPA stood at Rs 19,908 crore, and additional provisions of Rs 30,345 crore were made during the quarter. Gross NPA was 38 bps lower at 1.83% in Q1FY26, compared to 2.21% in Q1FY25. Net NPA declined 10 bps to 0.47%, down from 0.57% in the year-ago period.

Credit cost saw a marginal 1 bps YoY dip to 47% versus 0.48% in Q1FY25.

Post the bank’s Q1 results, several brokerage firms raised the stock’s target price. Motilal Oswal maintained a 'buy' rating with a target price of Rs 925, while JM Financial maintained a 'buy' rating with a target price of Rs 950. Antique Stock Broking maintained its 'buy' rating with a target price of Rs 955. Avendus upgraded the stock to 'buy' from 'add' and raised its target price to Rs 938.

Reference List:
[1] https://m.economictimes.com/markets/stocks/earnings/sbi-q1-results-standalone-pat-jumps-12-yoy-to-rs-19160-crore-beats-street-estimates/articleshow/123183756.cms
[2] https://economictimes.indiatimes.com/markets/stocks/news/sbi-shares-in-focus-as-brokerages-hike-target-price-to-rs-955-post-strong-q1-results/articleshow/123227462.cms
[3] https://www.financialexpress.com/business/banking-finance-higher-treasury-gains-drive-psbs-profitability-in-q1-3942246/