STOCK ANALYSIS –STATE BANK OF INDIA

Company Profile

The State Bank of India is India’s largest commercial banking, and financial services company. It is a state- owned bank  headquartered in Mumbai, and more than 14,000 branches, including 191 foreign offices spread across 36 countries, making it the largest banking and financial services company in India by assets The company is ranked 232nd on Fortune Global 500 Listofthe world’s biggest corporations.

SBIN provides banking services In addition the Bank through their subsidiaries, provides a range of financial services, which include life insurance, merchant banking, mutual funds, credit card, factoring, security trading, pension fund management and primary dealership in the money market. The Bank operates in four business segments, namely Treasury, Corporate/ Wholesale Banking, Retail Banking and Other Banking Business.

The 5 associate banks namely State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore, and BharatiyaMahila Bank were merged with State Bank of India with effect from 1 April 2017 and its present chairman is Mrs. “Arundhati Bhattacharya”.

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Sector View

India’s banking sector is sufficiently capitalized and well-regulated. The financial and economic conditions in the country are far superior to any other country in the world.

The growth of financial sectorin India at present is nearly 8.5% per year. The rise in the growth rate suggests the growth of the economy. The financial policies and the monetary policies are able to sustain a stable growth rate.

Indian economy experienced uncertainty in the past years. But as of now, The Indian economy became the fastest growing large economy for FY18. The economy has been on a relatively sound footing, growth and stable inflation. However, problems such as a weak investment climate and tepid earnings growth continue to plague the economy.

CASH DEPOSITS IN BANK’S AFTER DEMONETIZATION

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  • The announcement of demonetization has given boost to the Indian economy. Banking sector was the beneficiary with access to huge deposits. The banking sector witnessed a balance sheet growth of 7.7 percent in 2015-16 compared to 9.7 percent a year earlier. The loans are becoming cheaper and new investors are entering in the Indian market. Demonetization has a good long term impact on the banking sector, and overall economy

 

Balance Sheet of State Bank of India

——————- in Rs. Cr. ——————-

 

Mar 16 Mar 15 Mar 15 Mar 14 Mar 13
EQUITIES AND LIABILITIES
SHAREHOLDER’S FUNDS
Equity Share Capital 776.28 746.57 746.57 746.57 684.03
Total Share Capital 776.28 746.57 746.57 746.57 684.03
Reserves and Surplus 143,498.16 127,691.65 127,691.65 117,535.68 98,199.65
Total Reserves and Surplus 143,498.16 127,691.65 127,691.65 117,535.68 98,199.65
Total ShareHolders Funds 144,274.44 128,438.22 128,438.22 118,282.25 98,883.69
Deposits 1,730,722.44 1,576,793.24 1,576,793.24 1,394,408.51 1,202,739.57
Borrowings 224,190.59 205,150.29 205,150.29 183,130.88 169,182.71
Other Liabilities and Provisions 159,875.57 137,698.05 137,698.05 96,412.96 95,455.07
Total Capital and Liabilities 2,259,063.03 2,048,079.80 2,048,079.80 1,792,234.60 1,566,261.04
ASSETS
Cash and Balances with Reserve Bank of India 129,629.33 115,883.84 115,883.84 84,955.66 65,830.41
Balances with Banks Money at Call and Short Notice 37,838.33 58,977.46 58,977.46 47,593.97 48,989.75
Investments 477,097.28 495,027.40 495,027.40 398,308.19 350,927.27
Advances 1,463,700.42 1,300,026.39 1,300,026.39 1,209,828.72 1,045,616.55
Fixed Assets 10,389.28 9,329.16 9,329.16 8,002.16 7,005.02
Other Assets 140,408.41 68,835.55 68,835.55 43,545.90 47,892.03
Number of Employees 207,739.00 213,238.00 213,238.00 222,033.00 228,296.00
Capital Adequacy Ratios (%) 13.00 12.00 12.00 13.00 13.00
 

KEY PERFORMANCE INDICATORS

Tier 1 (%) 10.00 10.00 10.00 10.00 9.00
Tier 2 (%) 3.00 2.00 2.00 3.00 3.00
ASSETS QUALITY
Gross NPA 98,172.80 56,725.00 56,725.00 61,605.00 51,189.39
Gross NPA (%) 7.00 4.00 4.00 5.00 5.00
Net NPA 55,807.02 0.00 0.00 0.00 21,956.48
Net NPA (%) 4.00 2.00 2.00 3.00 2.00
Net NPA To Advances (%) 4.00 2.00 2.00 3.00 2.00

 

Key Extracts

 

  • SBI is the largest bank in India in terms of market share, revenue and assets.
    andhas its presence in 32 countries engaging currency trade all over the world,it will be the highest beneficiary from the increasing adoption of E-transactions.

 

  • SBI is a market leader in the banking sector and has grown up with substantial rate.With efficient management.

 

  • SBI was the first public sector move to CBS (Core Banking Solutions).

 

  • Expansion in rural areas can provide immense growth opportunities to SBI.

 

  • SBI’s merger with five more banks and new business initiatives will result in  expansion of market share and growth in revenues to defend its number one position and it is planning to expand and invest in international operations due to good inflow of money from Asian Market.

 

  • SBI Chairman Arundhati Bhattacharya is among Fortune’s 50 greatest leaders of the world.

 

  • SBI is all set for the immense growth with new strategies of business expansion to remain market leader. Hence all the investors who are willing to invest in SBI can get the magnificent returns.

 

TechnicalAnalysis

Monthly Chart:

This is the monthly analyzed chart of state bank of India SBI. After the split of SBI the stock is in uptrend and going up. As shown in the monthly chart down, stock is forming very good channel line. And nowtrading up to take breakout of the pattern (channel line). After these breakouts SBI will easily achieve 70% from the pattern breakout. (As defined target according to pattern). SBI, rise continues today. The support of 88.63 started the channel line formation with uprally on monthly chart on march 2009.

On Sep 2010 stock takes the sharp return by forming reversal pattern as doji from the resistance level of 324.79,And remains downside up to the support level of 150 in mar 2014. Channel line formed two legs and by the next resistance level of 336.30 and support level of 157.6,Stock completed 4 legs and meanwhile the rally continues to upside. Stock may take breakout above 350 and can move up to the next 450 level by the year ending.

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Technical View

Pivot Points (Weekly)
SCRIPT R3 R2 R1 P S1 S2 S3
SBI   310 303 293 286 275 268 257  

 

Pivot Points (Monthly)
SCRIPT R3 R2 R1 P S1 S2 S3
Tata Steel   335 315 304 284 273 253 242  

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