SBI Hits Second Position As India’s Most Profitable Industry in FY23

State Bank of India (SBI) makes it to the second most profitable company after Reliance Industries in FY23. The financial year 2022-23 marked a growth in the net profit of SBI to Rs. 55,648 Crore, the industry claimed on Thursday.

Over the past three years, India’s largest lender, SBI noted an upscale of 41 per cent in its earnings. The state-owned institution registered a Year-on-Year (YoY) of 57 per cent surge, owing to lesser provisions and higher interest revenue.

The Chairman of SBI, Dinesh Kumar Khara, proclaimed that the credit growth of the bank has been quite robust across all segments.

Further, there was also notable improvement in the asset quality as well as the performance in the international sectors was also seen to be thriving.

Remarkable Score For SBI In Numbers

Founded in 1955, the bank’s revenue growth also escalated to 7.57 per cent in FY23. The March quarter, howbeit, detailed a higher total revenue of 26.7 per cent on consolidated basis at Rs. 136,852 Crore.

Revenue growth in State Bank of India can be attributed to the treasury, corporate banking as well as retail banking. Mostly, the consumer banking growth has significantly boosted the bank’s profitable bounce in FY23.

The Net Profit in Q4 FY23 recognised an augmentation to Rs. 16,695 Crore with the YoY registered at 83.2 per cent.  Other Income in SBI Q4 witnessed a rise by 17.5 per cent YoY at Rs. 13,961 Crore.

However, for the full financial year of 2022-23, SBI reported downturn of other income by -9.7 per cent at Rs.36,616 Crore.

SBI noted a reduction in the Provisions and Contingencies by 32.5 per cent to Rs. 16,507 Crore in FY23, while Q4 itself showed a decrease to Rs. 3316 Crore with -54.2 per cent YoY.

The State Bank of India, being tech savvy, paved a way for its digital service profits with 35 per cent of retail asset accounts and 64 per cent of SB accounts registering through YONO app.

SBI Shares

SBI has witnessed an incredibly high throughput in the share market, since 2021.  The stocks of State Bank of India have seen to be doubled than their original value, compared to the Nifty50 during the same period.

The comprehensive Non-Performing Assets (NPA) ratio saw a huge decline in comparison to the previous 10 years. The last fiscal quarter reported the lowest NPA ratio with 2.78 per cent in contrast to the Q3 ratio of 3.14 per
cent.

SBI – Loans & Deposits

Being in the same boat as its banking peers, SBI exclaimed the rapid rise of loans compared to the deposits.

Deposits in SBI rose at a very slow pace that registered a YoY of 9.19 per cent to Rs. 44.24 lakh Crore. The deposit fees have escalated four times in the fiscal year.

Due to rising interest rates, the cost of deposit in SBI witnessed a jump in YoY of 16 basis points to 3.99 per cent.

Q4 of the last fiscal year recorded SBI’s loan book enlargement to Rs. 32.69 lakh Crore with a YoY of 15.99 per cent. Retail loan growth saw a boost in comparison to the corporate and home loans.

The fourth quarter beheld a surge in retail loan upsurge of Rs. 11.79 lakh Crore with YoY of 17.64 per cent. Home loans climbed up by a 14.07 per cent to Rs. 6.41 lakh Crore. Corporate loan grew to Rs. 9.8 lakh Crore and
registered a YoY of 12.52 per cent in Q4 of FY2022-23 in SBI.

As a consequence, the Net Interest Income (NII) for State Bank of India scored up by 20 per cent in FY23 to Rs. 144,841 Crore, whereas the fourth quarter itself noted a soaring YoY of 29.5 per cent at Rs. 40,393 Crore.

Moreover, this staggered the Net Interest Margins (NIM), which had thickened to 3.84 per cent from 3.40 per cent by 44 basis point. Yet, the NIM of SBI maintained lower values compared to the private sector banks.

Highest Profitable Industries In India

It is remarkable to note that no other firm except the Reliance Industries had ever achieved a profit more than Rs. 50,000 Crore. It has kept this top spot without any intervention since FY16.

The last financial year which ended on March 31 had Reliance Industries at the top of the profit list with Rs. 66,702 Crore valuation. Whereas, HDFC Bank bagged the third position with a net profit of Rs. 45,997 Crore.

In terms of profitable growth, industries including SBI, IOC, HDFC Bank, ONGC, and TCS have been competing strongly to be among the top 3 and have shown their upshots in alternate fashion.

Proofread & Published By Naveenika Chauhan