India's largest lender has zero 'sell' ratings; find out what is driving analyst optimism

Résumé détaillé

SBI's management indicated that corporate capital expenditure is gradually picking up across sectors such as thermal and renewable power generation, as well as roads. However, investment activity among mid-sized corporates remains relatively modest.

Shares of State Bank of India (SBI) were trading up as much as 2% on Thursday, November 12, amid positive brokerage commentary following the bank's US investor roadshow, where management outlined its growth priorities, loan expansion strategy and profitability targets.

CLSA maintained its 'Outperform' rating on SBI with a price target of ₹1,325, while Goldman Sachs retained its 'Buy' recommendation with a target price of ₹1,130.

According to CLSA's takeaways from the US roadshow, SBI management expressed optimism about the broader banking sector and the bank's own growth prospects.

Management indicated that corporate capital expenditure is gradually picking up across sectors such as thermal and renewable power generation, as well as roads. However, investment activity among mid-sized corporates remains relatively modest.

SBI reiterated its loan growth guidance of 14-15%, with retail, agriculture and MSME (RAM) loans expected to account for approximately 65% of its domestic loan portfolio.

On profitability, management highlighted return on assets (ROA) as a key focus area and reiterated its ambition to achieve a core ROA of 1% over the cycle. Improvement in fee income and more effective liability management were identified as key levers to support profitability.

On the deposit front, management attributed the relatively weak growth in current account (CA) deposits to a reduction in government deposits.

Goldman Sachs highlighted the chairman's broader strategic vision for SBI, which includes expanding its focus on personal loans to self-employed customers and strengthening its wealth management offerings.

The bank also plans to deepen its relationships with corporate and retail customers to unlock cross-selling opportunities, while modernising its operating model through greater adoption of artificial intelligence (AI) and digital initiatives.

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