State Bank of India (SBIN IN) – Q4FY26 Result Update – Slower corporate growth a key to better margins – BUY
Published on 09 May 2026
SBI saw a weak quarter due to 4.2% miss on NII driven by 18bps QoQ fall in domestic NIM to 2.93%. However, core PAT was 12.7% ahead of PLe due to better fees, opex and provisions. Sharp decline in NIM was led by (1) 25bps cut in repo (2) faster corporate growth QoQ and (3) shift in corporate mix towards lower yielding T-bill loans. Bank expects loan yield to improve from Q4’26 levels by slowing down corporate growth in FY27 (guided at 12-13% vs 16.6% in FY26) and focusing on better yielding accounts. We trim NII by avg. 2.8% for FY27/28E and cut core PAT by avg. 4%. We keep multiple of 1.4x on Mar’28 core ABV but lower TP to INR 1,200 from INR 1,280. Retain ‘BUY.
