SBI Shares Remain Volatile After Q4 Earnings: Buy, Sell, Or Hold?

SBI share price recovered a bit in early trade on Friday after the stock slipped sharply on Thursday as the lender posted its earnings for the quarter ended March.

What Happened: The public bank’s net interest income – the difference between the income a bank makes from its lending activities and the interest it pays to depositors – stood at ₹40,392.5 crore. The lender's net profits for the period stood at ₹16,694.51 crore, up over 83% from the ₹9,113.53 crore profit it booked in the March quarter of 2023. Both the top and the bottom lines beat consensus estimates by a wide margin.

The bank also declared a ₹11.30/share dividend for the year ended March. Despite all this, shares of the bank plummeted sharply after the results were announced on Thursday. Even today, after a brief recovery in early trade, shares went back into the red. So with this increased volatility what should investors do? Here’s what analysts are saying.

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JP Morgan maintained its ‘overweight’ rating for the stock with a price target of ₹720. The firm said that the bank’s operating profits were in line with estimates. The net interest income was 11% ahead.

Morgan Stanley also maintained its ‘overweight’ rating for the stock with a price target of ₹715. The firm said that the bank’s profit after tax beat estimated aided by higher margins and lower credit costs. It added that loan growth remained strong at 17% year-over-year.

Bernstein also assigned a ‘outperform’ rating to the stock with a target price of ₹700. The firm said the EPS was led by strong loan growth, margin expansion, and lower credit costs.

Domestic brokerage firm ICICI Securities also maintained its ‘buy’ rating for the stock raising the target price to ₹805 from ₹730. The brokerage said that SBI once again reported a strong quarter driven by strong business growth, NIM uptick, strong ‘other income', and contained credit costs.

Price Action: SBI share price was up 0.30% to trade at ₹575.90 in the early hours of trading on Friday.

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