SBI Shares Plummet 7%, Dragging PSU Bank Index 4% Lower Amid Q4 Results

SBI Shares Plummet 7.42% After Reporting Below-Expectation Q1 Earnings

State Bank of India (SBI), the country's largest lender, saw its shares decline by more than 7 percent on Friday following the release of its March quarter earnings. The stock hit a low of Rs 1,010.90 per share on the National Stock Exchange (NSE), a decline of 7.42 percent.

The PSU Bank index also traded around 4 percent lower during the session, led by losses in SBI. All constituents of the index traded in the red, indicating a broader market downturn.

SBI reported a 5.6 percent year-on-year (YoY) rise in standalone net profit at Rs 19,684 crore for the January-March quarter of FY25. However, the profit fell short of analysts' estimates of Rs 20,312 crore, according to Reuters-LSEG data. The bank's total income during the quarter declined to Rs 1,40,412 crore from Rs 1,43,876 crore in the corresponding period a year ago.

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Despite missing analysts' estimates, the bank reported a 4.1 percent rise in net interest income to Rs 44,380 crore during the quarter. Interest income increased to Rs 1,23,098 crore from Rs 1,19,666 crore a year earlier.

However, treasury income came under pressure during the quarter due to rising bond yields, which reduced the value of banks' bond holdings. RBI's curbs on forex arbitrage also impacted trading income, though some restrictions were eased later. As a result, income from treasury operations fell sharply to Rs 1,259 crore from Rs 8,991 crore in the year-ago period. Other income declined about 29 per cent to Rs 17,314 crore from Rs 24,367 crore earlier.

The bank stated that lower provisions and improvement in asset quality supported profit growth during the quarter. On a consolidated basis, SBI reported a marginal rise in net profit to Rs 19,643 crore for the quarter, compared with Rs 19,600 crore a year ago. Total income increased to Rs 1,81,079 crore from Rs 1,79,562 crore.

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For the full financial year FY25, standalone net profit rose 13 percent to Rs 80,032 crore against Rs 70,901 crore in the previous fiscal. The bank's board declared a dividend of Rs 17.35 per equity share of face value Re 1 each for FY25. The record date for determining shareholders eligible for the dividend has been fixed as May 16, with the dividend to be paid on June 4.