State Bank of India fell 4.84% to Rs 287.80 after a foreign brokerage reportedly downgraded the stock to equal-weight from overweight with target price at Rs 330 per share.
The brokerage firm reportedly raised FY2021 and FY2022 EPS estimates on shares of State Bank of India (SBI) by 5% each, adding that tax rate cut outweighs lower margins. The brokerage believes that upside appears limited given uncertainty on asset quality and net interest margins.Meanwhile, the S&P BSE Sensex was down 368 points or 0.94% to 38,729.04. The market surged recently after the Finance Minister Nirmala Sitharaman on Friday, 20 September 2019, slashed corporate tax rate to 22% without exemptions. The effective corporate tax rate after surcharge now stands at 25.17%. The step has significant positive implications for corporates' profitability, broader economy and market valuations.
As on 31 March 2019, SBI paid corporate tax of 46.36%.
Shares of State Bank of India fell 8.22% in two trading sessions to its current market price of Rs 287.80, from a recent closing high of Rs 313.60 on 23 September 2019.
SBI announced yesterday, 24 September 2019, that the proposed two-day bank strike on 26 and 27 September has been deferred.
On the BSE, 12.76 lakh shares were traded in the counter so far compared with average daily volumes of 16.43 lakh shares in the past two weeks. The stock hit an intraday high of Rs 299.40 and an intraday low of Rs 286.90 so far during the day.
The stock hit a 52-week high of Rs 373.70 on 18 July 2019. The stock hit a 52-week low of Rs 247.65 on 26 October 2018.
The stock outperformed the market over the past one month, rising 7.92% compared with 4.28% rise in the Sensex. The scrip underperformed the market in past one quarter, falling 14.38% as against Sensex's 0.07% fall. The scrip outperformed the market in past one year, jumping 14.33% as against Sensex's 7.69% rise.
On a consolidated basis, State Bank of India reported net profit of Rs 2,950.50 crore in Q1 June 2019 compared with net loss of Rs 4,230.44 crore in Q1 June 2018. Total income rose 11.3% to Rs 83,486.01 crore in Q1 June 2019 over Q1 June 2018.
State Bank of India provides a range of products and services to personal, commercial enterprises, large corporates, public bodies and institutional customers.
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