Ticker: SBIN | Share Price: ₹767.45 | Market Cap: ₹6.84 trillion (lakh crores)
State Bank of India (SBI) is popularly known as India’s largest lender- with a market share of roughly 25% of all lending and deposits, and 23% in terms of assets.
Valuation-wise
EPS (TTM) : ₹ 88.91
Book Value: ₹ 538.05
P/E : ₹8.63
P/B : 1.42
Observations
(i) To earn ₹1 from this share, you have to invest approximately ₹8.63 for a year.
(ii) The share trades 42% higher compared to its book value (accounting value
(iii) In comparison, public sector banks have a lower P/E of ₹6.8, trading only 20% higher in price than their book value.
(iv) Private sector banks have a higher P/E of ₹15.4, and trades roughly 140% higher in price compared to their book value.
Technically
Trend
Last Traded Price: ₹767.45
20 DEMA: ₹756.64
200 DEMA: ₹771.37
Oscillator
RSI (14 – Daily): 57.85
RSI Moving Average: 60.66
Price Levels (last 1 year)
| Zone | Price |
| Resistance 4 | ₹893.25 |
| Resistance 3 | ₹864.65 |
| Resistance 2 | ₹844.80 |
| Point of Control | ₹820.30 |
| Resistance 1 | ₹797.20 |
| Current Price | ₹767.45 |
| Support 1 | ₹767.45 |
| Support 2 | ₹729.35 |
| Support 3 | ₹709.95 |
Observations
(i) The share is trading at a lower price compared to the average price over the last 200 trading days, however it is trading at a price higher than last 20 days average- indicating appraisal in share prices.
(ii) Data shows an RSI of 57.85 over last 14 days indicating bullish strength, however a higher RSI average of 60.66 shows that the momentum has been lost to some extent.
(iii) Volumes play a significant role in the establishment of support & resistance levels. The current price is below the Point of Control at ₹820.30, indicating that the majority of the holders entering at that price point are currently at a loss. This sentiment may affect the stock negatively, however- in case the fundamentals remain unchanged, a value investment opportunity exists.
(iv) We can gain confidence in upwards momentum once the share price has crossed ₹820.30, otherwise we may look to sell holdings below ₹729.35.
Fundamentally
(i) India’s largest lender.
(ii) Public sector undertaking.
(iii) Considered to be the safest bank by the majority of Indians.
(iv) Textbook example of an undervalued stock.
(v) The share may face short-term volatility due to global trade tensions caused by tariff hikes by the U.S. Government.
(vi) The share is expected to maintain its position as one of the largest lenders, as a result the stock earnings are a value investment.
Our Outlook
We will keep a buy rating for SBI with a target of ₹1,000.
DISCLAIMER
* This is not an investment recommendation.
**Sequity Capital was holding 30 shares of SBI when this report was published.
Sequity Capital 