SBIN - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.2
| Stock Code | SBIN | Market Cap | 9,39,513 Cr. | Current Price | 1,018 ₹ | High / Low | 1,084 ₹ |
| Stock P/E | 13.2 | Book Value | 561 ₹ | Dividend Yield | 1.56 % | ROCE | 6.37 % |
| ROE | 17.3 % | Face Value | 1.00 ₹ | DMA 50 | 997 ₹ | DMA 200 | 900 ₹ |
| Chg in FII Hold | 0.77 % | Chg in DII Hold | -0.61 % | PAT Qtr | 16,666 Cr. | PAT Prev Qtr | 19,160 Cr. |
| RSI | 49.0 | MACD | 18.6 | Volume | 1,30,18,232 | Avg Vol 1Wk | 1,34,32,682 |
| Low price | 680 ₹ | High price | 1,084 ₹ | PEG Ratio | 0.43 | Debt to equity | 12.0 |
| 52w Index | 83.7 % | Qtr Profit Var | -9.09 % | EPS | 83.1 ₹ | Industry PE | 7.64 |
💰 Financials: SBI (SBIN) shows strong profitability with ROE at 17.3%, though ROCE at 6.37% indicates modest efficiency in capital usage. Quarterly PAT has declined (-9.09%), but overall earnings remain robust at ₹16,666 Cr. Debt-to-equity ratio of 12.0 reflects the nature of banking leverage, which is structurally high but manageable given SBI’s scale. Cash flows remain stable, supported by consistent interest income.
📊 Valuation: Current P/E of 13.2 is above the industry average of 7.64, suggesting a premium valuation. P/B ratio (~1.8) is reasonable given the book value of ₹561. PEG ratio of 0.43 indicates undervaluation relative to growth prospects. Intrinsic value analysis suggests the stock is fairly valued but offers upside if earnings growth sustains.
🏦 Business Model & Competitive Advantage: SBI is India’s largest public sector bank with a dominant market share in deposits and advances. Its scale, government backing, and extensive branch network provide a strong moat. Digital transformation initiatives and retail lending expansion further strengthen its competitive edge.
📈 Entry Zone: Considering DMA 50 (₹997) and DMA 200 (₹900), accumulation is attractive in the ₹950–₹980 range. Long-term investors can hold for compounding returns, given SBI’s systemic importance and improving asset quality.
Positive
- Strong ROE at 17.3% indicates efficient shareholder returns.
- PEG ratio of 0.43 highlights undervaluation relative to growth.
- Government backing ensures stability and trust.
- Improving digital banking ecosystem enhances customer reach.
Limitation
- ROCE at 6.37% reflects limited efficiency in capital deployment.
- High debt-to-equity ratio (12.0) inherent to banking sector.
- Quarterly profit decline (-9.09%) raises short-term concerns.
- Valuation premium compared to industry peers (P/E 13.2 vs 7.64).
Company Negative News
- Recent quarterly PAT decline from ₹19,160 Cr. to ₹16,666 Cr.
- Marginal reduction in DII holdings (-0.61%).
Company Positive News
- Increase in FII holdings (+0.77%), signaling foreign investor confidence.
- Stock trading near 52-week high, reflecting strong market sentiment.
Industry
- Banking sector P/E at 7.64 indicates SBI trades at a premium.
- Sector growth driven by retail lending, digital adoption, and credit demand.
- Public sector banks gaining traction with improved asset quality.
Conclusion
🔑 SBI remains a fundamentally strong stock with systemic importance, robust ROE, and growth potential. While short-term profit decline and high leverage are concerns, its scale, government support, and undervaluation relative to growth make it a solid long-term holding. Entry around ₹950–₹980 offers a favorable risk-reward balance for investors.
Would you like me to also prepare a comparative HTML report against private banks like HDFC or ICICI to see how SBI stacks up against its peers?