Underperforming SBI shares still have the potential to cross ₹1,000, analysts say after Q1

Shares of India’s largest lender, State Bank of India Ltd., will be reacting to their quarterly results on Monday, August 11. SBI’s June quarter results were higher on a year-on-year basis on the profitability front, but its core income was below expectations.SBI reported a 15% year-on-year growth in net profit at ₹19,160 crore. The profitability of the lender was aided by a higher other income component. Net Interest Income (NII) or core income for the quarter remained flat at ₹41,072.4.

SBI’s asset quality for the quarter remained stable. Fresh slippages stood at ₹7,945 crore.

SBI reaffirmed its 12% loan growth and 10% deposit growth guidance for FY26, despite external headwinds and global uncertainty.Here are what brokerages are saying on SBI:

Brokerage firm HSBC has a ‘Buy’ rating on SBI, with a price target of ₹960.

The brokerage said that Q1FY26 operating performance was in line, with strong treasury income driving a profit-after-tax (PAT) beat. Asset quality trends remained contained.

The brokerage expects SBI to deliver healthy loan growth, maintain net interest margins (NIM), aided by a recent capital raise, higher loan-to-deposit ratio (LDR), and lower liquidity.

Bernstein has a ‘Marketperform’ rating on SBI, with a price target of ₹800.
Q1 loan and deposit growth stood at 12% YoY (slightly above ICICI Bank’s YoY loan growth) but came at the cost of a sharper margin decline.However, return on assets (RoA) was sustained above 1% despite flat NII growth YoY, supported by strong non-interest income (NOI) from gains on profit and revaluation of investments.

Seasonal slippages rose during the quarter, but higher recoveries kept credit costs steady at 47 bps.

While core profitability remains weak, elevated NOI gains and continued recoveries and upgrades helped maintain RoA, Bernstein wrote in its note.

UBS has a ‘Neutral’ rating with a price target of ₹880.

UBS said that Q1 margins were in line, with higher other income and controlled operating expenses driving earnings. Business growth was modest, and LDR moderated by 70 bps QoQ.

Management remains confident about meeting loan growth and NIM guidance.

At 0.9x Sep’26E price-to-book value (P/BV), UBS sees the risk–reward as balanced.

CLSA has an ‘Outperform’ rating with a price target of ₹1,050. The brokerage said that SBI continues to outpace sector in loan growth, growing by 2 percentage points, led by strong retail loan growth.

Jefferies maintained a ‘Buy’ rating on SBI, with a price target of ₹970. Nuvama Institutional Equities also reiterated its ‘Buy’ rating with an unchanged price target of ₹950.

Shares of SBI fell to the day’s low after the earnings announcement but recovered slightly before ending 0.33% lower at ₹802.50. The stock has just risen 1% so far in 2025.