SBI in Focus Ahead of Q3; NPA's Likely to Fall, Analysts Say

State Bank of India shares rose 2 per cent on Friday ahead of its quarterly earnings. The state-run lender was among the top Nifty gainers in morning trade.

Over the last two weeks, a number of PSU lenders have reported a sharp deterioration in asset quality, which has impacted sentiments around banking stocks; investors probably expect SBI to buck the trend.

SBI's slippage (fresh loans that have turned bad) is expected to 3 per cent of advances, analysts say. Gross non-performing assets, as a percentage of advances, is expected to narrow to 4.7 per cent in the December quarter at Rs 61,800 crore as against 4.9 per cent in the previous quarter at Rs 60,700 crore, according to analysts polled by NDTV.

SBI's profit in Q3 is estimated to rise by 47 per cent year-on-year to Rs 3,292, according to analysts polled by NDTV. Net interest income, the different between interest paid on deposits and earned on advances, is expected to rise to Rs 13,730 crore in Q3 versus Rs 12,640 crore in the corresponding quarter of last year.

SBI shares traded 1.2 per cent higher at Rs 287.60 as of 10.08 a.m. The stock outperformed the Bank Nifty, which traded with 0.5 per cent gains.