SBI Plunges Over 7%, Falls The Most In Over 4 Years

State Bank of India or SBI shares on Wednesday ended 7.33 per cent lower at Rs 280.15 apiece on the Bombay Stock Exchange (BSE), a day after Morgan Stanley downgraded the stock to equal-weight from overweight with target at Rs 330 per share. That posted biggest single-day fall for SBI since August 24, 2015, data compiled by BSE showed. On the National Stock Exchange (NSE), SBI shares ended 7.70 per cent lower at Rs 279.30 apiece. SBI shares declined as much as 7.88 per cent on the BSE to an intraday low of Rs 278.60 apiece. On the NSE, SBI shares opened lower at Rs 297.00 apiece and fell to as much as Rs 278.70 apiece, marking an intraday decrease of 7.89 per cent. 

SBI shares witnessed heavy trading volumes in today's session as 29.71 lakh shares changed hands on the BSE compared with an average of 16.43 lakh shares traded daily in the past two weeks.

Morgan Stanley said that upside appears limited given uncertainty on asset quality and net interest margins. The brokerage firm, however, raised FY21 & F22 earnings per share (EPS) estimates by 5 per cent each, adding that tax rate cut outweighs lower margins.

Earlier this week, SBI said that it would adopt the repo rate as external benchmark for all its floating rate-based loans from October 1. The bank - which had introduced floating rate-based home loans from July 1, 2019 - said it has made some modifications in the scheme effective October 1, 2019, to comply with the latest regulatory guidelines.

In April-June quarter, SBI reported net profit of Rs. 2,312.20 crore, compared with loss of Rs. 4,875.85 crore in the same quarter last year. The bank's provisions for bad loans dropped 32.80 per cent to Rs. 11,648.45 crore from Rs. 17,335.84 crore in the previous quarter and Rs. 13,037.90 crore in the year ago period.