State Bank of India: net profit up 13.7%, but revenue growth slows to 10.2%

State Bank of India раскрыла результаты за первый квартал 2026 года: чистая прибыль выросла на 13,7% год к году, до 241 130 млн INR, при росте чистого процентного дохода на 10,2%, до 978 142,9 млн INR. Акции торгуются с P/E 10,7, что ниже исторических уровней, и предлагают дивидендную доходность 1,73%. Вердикт: акции выглядят привлекательно благодаря устойчивому росту прибыли и разумной оценке.

Key takeaways

— Net profit grew 13.7% driven by a 10.2% increase in net interest income

— Net interest income rose 10.2% to INR 978,142.9 million in Q1 2026

— Return on equity stood at 15.8%, supporting the valuation

— Dividend yield of 1.73% at the current price, below the key rate but stable

— The portal's model sees a potential upside of +10% from the current price

— Debt burden is not a meaningful metric for a bank, but net debt rose to INR 4,708,275.6 million

Attractiveness

Key figures, INR bn

Net profit grew 13.7% driven by a 10.2% increase in net interest income

In Q1 2026, State Bank of India reported net profit of INR 241,130.0 million, up 13.7% year-on-year. The main driver was net interest income, which rose 10.2% to INR 978,142.9 million.

Profit growth outpaced interest income growth, indicating improved operating efficiency or lower provisioning costs. However, revenue growth slowed compared to previous quarters: Q2 2025 saw 8.1% growth, Q3 2025 20.8%, and Q4 2025 15.5%.

Net interest income rose 10.2% to INR 978,142.9 million in Q1 2026

Net interest income for Q1 2026 stood at INR 978,142.9 million, up 10.2% year-on-year. This is a slowdown compared to previous quarters: Q2 2025 saw 8.1% growth, Q3 2025 20.8%, and Q4 2025 15.5%.

Over the trailing twelve months, net interest income reached INR 3,908,000.0 million. Interest income remains the bank's primary revenue source, but its growth may moderate as interest rates normalise.

Return on equity stood at 15.8%, supporting the valuation

Return on equity (ROE) for the trailing twelve months stood at 15.8%. This is a strong figure for the banking sector, supporting the attractiveness of the shares at the current price.

With a P/E of 10.7 and ROE of 15.8%, the shares trade at a discount to book value, making them appealing for long-term investors. The portal's model sees a potential upside of +10% from the current price.

Dividend yield of 1.73% at the current price, below the key rate but stable

Over the trailing twelve months, State Bank of India's dividend yield stood at 1.73% based on a market capitalisation of INR 9,235,235.31 million. This is below the key rate, but payments remain stable.

The bank pays dividends regularly, and at current profit levels the payout ratio appears sustainable. However, if profits decline, dividends could be cut.

The portal's model sees a potential upside of +10% from the current price

According to the portal's model, which compares annualised earnings to market cap and ROE to P/B, the fair value of State Bank of India shares is 10% above the current price. This is a moderate upside potential, not a target price, but a reference point.

With a current P/E of 10.7 and ROE of 15.8%, the shares appear undervalued relative to their own history, supporting the growth potential.

Debt burden is not a meaningful metric for a bank, but net debt rose to INR 4,708,275.6 million

For a bank, net debt does not reflect actual leverage, as deposits and borrowings are part of the business. Nevertheless, at the end of Q1 2026, net debt stood at INR 4,708,275.6 million, higher than in previous quarters.

The rise in net debt is linked to higher client balances and credit expansion, which is normal for a bank. Operating cash flow is not considered a performance metric, as it depends on client fund movements.

Valuation on the latest reported figures

Bottom line

В первом квартале 2026 года State Bank of India показала устойчивый рост чистой прибыли на 13,7%, поддержанный увеличением чистого процентного дохода на 10,2%. Рентабельность капитала в 15,8% и P/E 10,7 делают акции привлекательными на текущем уровне. Дивидендная доходность 1,73% невысока, но стабильна. Основной вопрос для держателей – сможет ли банк сохранить темпы роста процентных доходов в условиях замедления экономики. Вердикт: акции привлекательны.