State Bank of India shares in trade on May 19, 2022 have tumbled in line with the broader indices. Last at around the time of writing this copy, the stock was trading with a cut of 2.55% at Rs. 446.25. The stock hit its 52-week high this year of Rs. 549 scaled on February 7, 2022, while its 52-week low price is Rs. 378 pe share.
The largest PSB in its recent March ended quarter reported improvement in its standalone profit from Rs. 6450.75 crore to Rs. 9113.5 crore in Q4Fy22 period. The bank's asset quality has also improved with % of gross NPAs coming down to 3.97% as against 4.5% in the previous quarter. Also, % of net NPAs also saw a fall from 1.34% to 1.02%. So, fundamentally, the bank considering its financials looks strong.
Another thing worth highlighting as mentioned in the Yes Securities report on the stock is that bank has over 70% of the floating rate loans on its books and hence NIM expansion is seen going forward.
Dividend declared and record date:
The banking entity announced 710% of Rs. 7.1 per share dividend for Fy22 for which the record date has been decided as May 26, 2022. Record date is the date basis which shareholders eligibility to receive the announced dividend shall be determined and the stock shall turn ex-dividend on May 25, 2022. So, it is just 3 more trading sessions left until which you can buy the share of SBI and be eligible for the dividend announced of Rs. 7.1 per share.
Buy SBI for further good upside and Rs. 7.1 per share dividend
As for now, the stock is trading steeply down from its 52-week high of 549 i.e. down by over 18% which offers a good entry point. Further because of the ongoing correction, the Nifty Bank index is said to have come to an attractive PE of 17.64. On the attractive PE of the banking index, PE, Ravi Singhal, Vice Chairman at GCL Securities is quoted as saying in a leading dailies, "If we leave the year 2020 as exception, then Nifty Bank PE is at five years low, which is enough to understand the possibility of bull run in banking index and some Bank Nifty listed stocks. Those, who believe in positional investment for medium to long term investment can think of looking at quality banking stocks like SBI and Kotak Mahindra Bank shares for whopping returns." Also, he added that those stocks who have their PE multiple around the Bank Nifty index may give sharp upside moves in upcoming sessions post-market bottom.
So, looking at the potential of the stock considering the Bank Nifty P/E and bank-specific financials, one can bet upon the stock for good upside in the medium to long term together with dividend income. Also, Yes Securities in its most bullish outlook for the stock has given the target price as Rs. 659 per share.