Buy State Bank of India, target price Rs 473: LKP Securities

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Buy State Bank of India, target price Rs 473:  LKP Securities


has buy call on State Bank of India with a target price of Rs 473. The current market price of State Bank of India is Rs 409.

State Bank of India, incorporated in the year 1955, is a banking company (having a market cap of Rs 367069.27 Crore).

Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 97182.15 Crore, up 1.90 % from last quarter Total Income of Rs 95373.50 Crore and up 1.88 % from last year same quarter Total Income of Rs 95384.28 Crore. The bank reported net profit after tax of Rs 6257.55 Crore in latest quarter.


Investment Rationale
The brokerage expects the bank to post a ROA/ROE of 0.5%/9.1% by FY22E led by healthy balance sheet growth along with higher PCR and stable asset quality. It has rerated the stock with BUY and increased target price of Rs 473 (potential upside of 14%). It values the standalone bank with PBV of 1.3xFY22E Adj. BVPS of Rs 258 and value of subsidiaries per share of Rs 112.

Promoter/FII Holdings
Promoters held 57.4 per cent stake in the company as of Dec 30, 2020, while FIIs held 9.82 per cent, DIIs 23.81 per cent and public and others 8.73 per cent.





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