This BlueChip Stock Receives Multiple Buy Calls, Upto 39% Upside Pegged

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This BlueChip Stock Receives Multiple Buy Calls, Upto 39% Upside Pegged
Credit: © Reuters.

By Malvika Gurung -- The public sector lender State Bank of India (NS: SBI ) has received multiple Buy calls on its stock, with most brokerages bullish on the counter. 

Even though the public lender stock has not performed very well, rising only 6.5% over the past year, it has still managed to outperform the BSE Bankex index which has fallen 2% in the period.

The stock was trading 0.25% higher at Rs 462.35 apiece at the time of writing, and an average target price of Rs 624.33/share has been set on the public lender counter, an upside of 35%.

Brokerage Edelweiss (NS: EDEL ) believes that concerns over SBI’s asset quality from FY13-19 have dissipated, marking a recent sharp pickup in loan growth. It sees the lender’s strong efforts to revamp strategy in incumbent business segments and remarkable digital progress being underappreciated.

The brokerage has set a target price of Rs 640/share on the stock, an upside of 38.4%.

Brokerage Motilal Oswal (NS: MOFS ) views the counter to resist mark-to-market losses on its treasury portfolio as the rate environment continues to harden. It has set a TP of Rs 600/share on the stock.

Asset quality performance has been strong and the outlook remains healthy as the restructured book remains in control at 1.1%, while the SMA pool has declined further to 13bp of loans. We conservatively estimate credit cost to moderate to 0.9%, enabling 28% earnings CAGR over FY22-24, added the brokerage.

SBI has received a total of at least 42 Buy calls on its stock, with not even a single ‘Sell’ rating.

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