State Bank Of India

Our reasoning

SBI’s outlook remains positive, supported by strong Q1FY27 operating momentum, with gross advances growing 18.6% YoY and 2.3% QoQ to ₹50.5 lakh crore, while total deposits grew 9.7% YoY and 0.5% QoQ to ₹60.1 lakh crore. Domestic NIM improved 7 bps QoQ to 3.0%, prompting management to retain its ~3% FY27 NIM guidance. Credit growth guidance was raised to 13–15% from 12–14%, supported by broad-based Agri (+25.4%), SME (+22.3%) and Corporate (+18.1%) growth. Asset quality remains strong, with GNPA at 1.47%, NNPA at 0.38% and credit cost at 0.27%, while RoA improved to 1.11%. We have a positive view at current valuations based on its superior asset quality, strong advances growth, and improving CASA deposits, which are expected to boost profitability and RoA.