SBI Market Cap Nears Rs 6 Trillion Mark After Stock Trades At New 52-Week High; Up Over 16% In 1 Month

SBI shares hit a new 52-week high of Rs 659.50, up almost 2% in the intraday trading on Tuesday amidst heavy volumes on the expectation of sound profitability over the medium term.

The share price of the country's largest public sector lender State Bank of India (SBI) was spotted trading 1.09% higher at Rs 655.95 per share at 3:13 pm IST today. Before this, SBI stock price traded at a new 52-week high of Rs 649.95 on December 15, 2023.

In the past one month, SBI shares have outperformed the broader market as the stock has gained over 16% in the last one month, while the S&P BSE Sensex and the Nifty 50 are up almost 9%, and the Nifty PSU Bank index is up 14% during this period.

A sharp jump in the company's share price has pushed up its valuation. At today's peak at Rs 659.50 per share, SBI's market cap has moved close to the Rs 6 Trillion mark. At Rs 655.95 per piece, the company commands a market cap of 5.85 trillion.

The brokerage firm Motilal Oswal has raised its target price for India's state-run lenders like State Bank of India Ltd., Bank of Baroda Ltd, Canara Bank Ltd., and Union Bank of India Ltd.

PSU Bank index has tripled in value since 2021 and its market capitalization breached the Rs 13 lakh crore mark last Friday. The last three years has seen the index advancing 45%, 71%, and 33% (YTD) respectively.

According to Motilal Oswal, by the financial year 2026, the earnings pool of PSU banks is expected to grow to 1.7 lakh crore compared to Rs 57,300 crore in the financial year 2022. The Liquidity Coverage Ratio (LCR) of these banks is now at comfortable levels and they also carry a robust liability franchise, stated the brokerage firm in its report.

Except SBI, wage provisions are likely to have a limited impact on these lenders and their operating expenses will also moderate, the brokerage wrote.

In view of these factors, Oswal has revised price targets higher for state-run lenders like SBI, Bank of Baroda, India Bank, Union Bank, Canara Bank, and PNB.

With a Buy rating, the brokerage firm has revised its share price target for SBI from Rs 700 to Rs 800.

The price target of Union Bank of India Ltd., Bank of Baroda Ltd., Indian Bank, and Canara Bank has been raised to Rs 150, Rs 280, Rs 525, and Rs 550 respectively.

SBI stock price performance:

In the last six months, SBI shares have gained 15.08%, while the stock's last three months' performance is up 8.38%. In the last one year, returns from SBI shares have increased 8.20% and the stock has gained 141.18% in the last three years.