The State Bank of India (SBI) rode on other income to report a 178.25 per cent rise in quarterly net profit that beat Street estimates but asset quality lagged targets that led to a fall in its share price.

Standalone net profit in the first quarter of the current fiscal jumped to Rs 16,884 crore compared with Rs 6,068 crore in the corresponding period of the previous year.

Analysts polled by Bloomberg had estimated a Rs 14,948.66 crore net profit for the first quarter.

Shares of the bank ended in the red as core net interest income (NII) came below estimates and slippages rose on a sequential basis.

The record profit — it rose for the fourth quarter running — came as other income jumped sharply to Rs 12,063.38 crore against Rs 2,312.20 crore in the same period of the previous year and provisions declined to Rs 2,501.31 crore from Rs 4,392.38 crore.

The other income included treasury gains, rise in fee income and recovery from advance under the collection amount or AUCA accounts (technical write-offs). SBI disclosed that the recovery from AUCA accounts stood at Rs 1,134 crore during the first quarter.

Net interest income — interest earned minus interest expended — stood at Rs 38,905 crore compared with Rs 31,196 crore in the year-ago period — a rise of 24.71 per cent.
This was lower than estimates of brokerages such as ICICI Securities which had forecast a 27 per cent growth over the previous year.

While there was an improvement in asset quality, the street was disappointed by a rise in slippages over the preceding quarter.

Slippages at SBI stood at Rs 7,659 crore which was more than double the amount of Rs 3,098 crore in the January-March period. It was, however, lower than Rs 9,740 crore in the first quarter of the previous year.

The percentage of gross non performing assets (NPAs) declined to 2.76 per cent from 2.78 per cent in the preceding quarter while the absolute amount of gross NPAs stood at Rs 91,328 crore against Rs 90,928 crore in the fourth quarter of 2022-23.

During the quarter, SBI’s credit grew 13.90 per cent with domestic advances rising 15.08 per cent over the previous year.

Disappointment over slippages and NII saw the SBI share falling 2.94 per cent to settle at Rs 573.25 on the BSE.

During the day, it declined by 3.23 per cent to Rs 571.50, while it dropped 2.92 per cent to end at Rs 573.20 on the NSE.

The stock was the biggest laggard on both the Sensex and Nifty, and its market valuation declined Rs 15,484.2 crore to Rs 5.11 lakh crore.