State Bank of India (SBI), the country's largest public sector lender, announced its financial results for the fourth quarter (Q4) ended March 31, 2025, on Saturday, May 3, 2025. The SBI results revealed a mixed picture: while the bank reported a significant year-on-year (Y-o-Y) decline in standalone net profit, primarily driven by a substantial increase in provisions, it also showcased continued improvement in asset quality and steady operational performance and rewarded shareholders with a generous dividend.
For Q4 FY25, SBI posted a standalone net profit of ₹18,643 crore, marking a 9.9% decline compared to the ₹20,698 crore earned in the same quarter of the previous fiscal year (FY24). This dip was primarily attributed to a sharp rise in provisions during the quarter.
However, countering the profit decline, the bank's board declared a dividend of ₹15.90 per equity share for 2024-25. Despite the quarterly profit drop, SBI achieved a record net profit of ₹70,901 crore for the full financial year FY25, reflecting a robust 16.08% Y-o-Y growth.
The state bank q4 results thus present a narrative of short-term provisioning impact overshadowing underlying operational strength and improving balance sheet health, a key theme explored in these SBI Q4 results 2025.
SBI Q4 FY25 Financial Highlights: Overview
- A mixed quarter with a Y-o-Y decline in net profit due to higher provisions, but strong underlying operational performance and record annual profit.
- Asset quality continued to improve significantly.
- Steady business growth was maintained, though loan growth outpaced deposit growth.
- Shareholders were rewarded with a dividend, and future growth is supported by a planned capital raise.
SBI Q4 FY25 Financials: Profit Meets Estimates Despite Provision Surge
Net Profit Deep Dive
The headline figure for SBI's Q4 FY25 was its standalone net profit of ₹18,642.59 crore (often rounded to ₹18,643 crore). This represented a 9.9% to 10% decrease compared to the ₹20,698 crore profit recorded in Q4 FY24. The primary reason for this decline was a significant provision increase during the quarter. On a sequential basis (Q-o-Q), the net profit showed a healthy growth of 10.4% from ₹16,891 crore reported in Q3 FY25 (December 2024 quarter).
- Standalone Q4 FY25 Net Profit: ₹18,643 crore.
- Year-on-Year (Y-o-Y) Change: Declined by 9.9% to 10% compared to ₹20,698 crore in Q4 FY24.
- Primary Reason for Y-o-Y Decline: Significant increase in provisions and contingencies.
- Quarter-on-Quarter Change: Increased by 10.4% compared to ₹16,891 crore in Q3 FY25.
- Alignment with Expectations: The net profit figure met market analyst estimates (range ~₹17,400 Cr - ₹19,000 Cr), which had factored in higher provisions.
- Full Year FY25 Net Profit: A record high of ₹70,901 crore, marking a 16.08% increase YoY.
- Consolidated Q4 FY25 Net Profit: ₹19,600 crore (down 8% Y-o-Y).
Interest Income and Margin Pressure
SBI's Net Interest Income (NII) – the difference between interest earned on loans and interest paid on deposits – showed modest growth in Q4 FY25. NII increased by 2.69% to 2.7% Y-o-Y, reaching ₹42,775 crore compared to ₹41,655 crore in Q4 FY24. Sequentially, NII saw a slightly better growth of 3.21%. This NII figure was broadly in line with, or slightly below, analyst expectations, which hovered around ₹42,700 crore to ₹43,200 crore.
- Net Interest Income (NII) Q4 FY25: ₹42,775 crore.
- NII Growth (Y-o-Y): Increased by 2.7% (from ₹41,655 crore).
- NII Growth (Q-o-Q): Increased by 3.21%.
- NII vs Expectations: Broadly in line with or slightly below analyst forecasts.
- Net Interest Margin (NIM) - Domestic: Declined by 32 bps Y-o-Y to 3.15% (from 3.47% in Q4 FY24).
- NIM - Whole Bank: Reported at 3.0% for Q4 FY25.
- Margin Pressure: Reflects the industry challenge of rising deposit costs potentially squeezing profitability margins.
Operating Profit and Provisions
SBI's Pre-Provisioning Operating Profit (PPOP) demonstrated resilience, growing 8.83% Y-o-Y to ₹31,286 crore in Q4 FY25. This performance was better than some analyst projections that had anticipated a Y-o-Y decline, possibly indicating stronger-than-expected non-interest income or better control over operating expenses. For the full year FY25, SBI's operating profit crossed the ₹1 lakh crore mark, growing 17.89% Y-o-Y to ₹1,10,579 crore.
- Pre-Provisioning Operating Profit (PPOP) Q4 FY25: ₹31,286 crore.
- PPOP Growth (Y-o-Y): Increased by 8.83%, exceeding some analyst projections.
- PPOP Full Year FY25: Crossed ₹1 lakh crore, reaching ₹1,10,579 crore (up 17.89% YoY).
- Total Provisions Q4 FY25: Surged significantly to ₹12,643 crore (from ₹8,049 crore in Q4 FY24 and higher Q-o-Q).
- Loan Loss Provisions: Increased 20.35% Y-o-Y to ₹3,964 crore.
- Provisioning Rationale: Viewed as proactive balance sheet strengthening rather than a reaction to deteriorating asset quality, directly impacting Q4 net profit.
- Cost-to-Income Ratio: Improved to 51.64% (excluding wage revisions/one-offs) as of March 31, 2025, down from 55.66% Y-o-Y.
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Asset Quality Continues to Strengthen in SBI Q4 Results
NPA Ratios Decline Further
A significant positive in the SBI Q4 results 2025 was the continued improvement in asset quality. The bank's Gross Non-Performing Assets (GNPA) ratio declined to 1.82% as of 31 March 2025. This marks a substantial improvement of 42 basis points (bps) from 2.24% in Q4 FY24 and is also lower than the 2.07% recorded in Q3 FY25. In absolute terms, GNPA stood at ₹76,880.20 crore.
- Gross NPA (GNPA) Ratio: Declined to 1.82% (Improvement of 42 bps Y-o-Y and 25 bps Q-o-Q).
- Absolute GNPA: ₹76,880.20 crore.
- Net NPA (NNPA) Ratio: Improved to 0.47% (Improvement of 10 bps Y-o-Y and 6 bps Q-o-Q).
- Absolute NNPA: ₹19,666.92 crore.
- Provision Coverage Ratio (PCR): Stood at 74.42% (improved 60 bps Y-o-Y).
- PCR including write-offs: 92.08%.
- Slippage Ratio (FY25): Improved by 7 bps Y-o-Y to 0.55%.
- Slippage Ratio (Q4 FY25): 0.42% (marginally better by 1 bp Y-o-Y).
- Credit Cost (FY25): Remained low at 0.38%.
- Overall: Consistent improvement highlights effective risk management and recovery.
Steady Business Growth: Advances Outpace Deposits
SBI continued to exhibit strong business growth, although slightly moderated compared to some high expectations. Overall bank advances grew by 12.03% Y-o-Y, reaching ₹42 lakh crore as of March 31, 2025. Domestic advances specifically saw an 11.56% Y-o-Y growth. While robust, this was slightly below some analyst forecasts that pegged growth closer to 13-14%.
- Advances Growth (Y-o-Y): Grew by 12.03% to ₹42 lakh crore.
- Domestic Advances Growth: +11.56% Y-o-Y.
- Retail Personal Advances: +11.40% YoY (Home Loans +14.46% Y-o-Y).
- Corporate Loans: +9% Y-o-Y.
- Deposit Growth (Y-o-Y): Grew by 9.48% to ₹53.8 trillion.
- Market Share: Estimated at 19.06% for net advances and 22.55% for deposits.
- Growth Gap: Loan growth outpacing deposit growth, potentially pressuring liquidity and NIMs.
- CASA Ratio: A reported figure of 6.34% seems anomalous; moderation is more likely than such a drastic drop.
Shareholder Returns and Future Outlook: Dividend & Fundraising
Dividend Announcement
In a positive move for shareholders, SBI's board declared a dividend of ₹15.90 per equity share for FY25. This dividend aligns with the bank's history of healthy payouts and offers a dividend yield of approximately 1.71% to 1.74% based on the share price preceding the results. The record date for the dividend is set for 16 May 2025, with the payment date scheduled for 30 May 2025.
FY26 Fundraising Plans
Looking ahead, SBI's board has approved a significant fundraising plan for the financial year 2025-26 (FY26). The bank intends to raise equity capital of up to ₹25,000 crore. This capital raise can be executed through various modes, including a Follow-on Public Offer (FPO), Rights Issue, Qualified Institutional Placement (QIP), or a combination thereof, subject to necessary approvals.
This decision comes even as the bank maintains a comfortable Capital Adequacy Ratio (CAR), which stood at 14.25% as of March 2025, well above regulatory requirements. The Common Equity Tier 1 (CET-1) ratio was 10.81%. Raising substantial equity despite adequate capitalisation suggests a strategic move rather than a response to immediate capital needs. This proactive capital buffering is likely aimed at supporting future business expansion (consistent with the 12%+ loan growth), comfortably meeting any upcoming regulatory capital norms, and building resilience against potential economic uncertainties.
SBI Share Price Performance and Analyst Viewpoint
Recent Share Price Movement
SBI's share price exhibited positive momentum leading up to the announcement of Q4 results. On Friday, 2 May, the stock closed around 1.5% to 1.6% higher, settling near the ₹800 mark on the BSE.
Looking at the longer-term performance, the stock has been relatively flat year-to-date (YTD) in 2025 and slightly down over the past one year. However, it has delivered strong returns for investors over medium to long horizons, with a 40% gain over two years and multibagger returns of approximately 320% over the past five years. The share price has traded between a 52-week high of ₹912 and a low of ₹680. Technical analysts had noted a potential bullish breakout pattern earlier in April, suggesting support levels around ₹770-780 and potential upside targets near ₹835 and ₹875, provided the support holds.
Analyst Ratings and Outlook
Despite the Y-o-Y decline in Q4 net profit, the overall sentiment among analysts regarding SBI remains largely positive, focusing on the bank's long-term fundamentals. Brokerages like Motilal Oswal Financial Services (MOFSL) maintained a 'Buy' rating with a target price of ₹925 per share, citing SBI's potential for sustainable growth driven by substantial credit expansion, well-managed asset quality risks, and advancements in digital transformation. MOFSL projects a 9% earnings Compound Annual Growth Rate (CAGR) for SBI over FY25 - 27.
Analysts view the bank's valuation as reasonable, with MOFSL noting it traded at approximately 1.0 times its estimated FY26 adjusted book value. The consistent improvement in asset quality, steady business growth, dominant market position, and proactive capital management are key strengths that outweigh the temporary impact of higher provisions in Q4.
Analysts will continue to monitor the trajectory of Net Interest Margins, guidance on loan and deposit growth, trends in return ratios, and developments in asset quality, particularly within the MSME segment.
Conclusion: SBI Q4 Results - A Mixed Bag with Strong Undercurrents
The State Bank Q4 results for FY25 presented a nuanced story. While the headline net profit saw a 10% Y-o-Y decline to ₹18,643 crore, this was primarily due to a calculated increase in provisions, which the market largely anticipated.
Beneath this figure, the SBI results showcased considerable strength. The bank achieved record annual profits for FY25, consistently improved asset quality with declining GNPA and NNPA ratios, maintained steady NII growth, and continued its double-digit loan expansion.
Furthermore, SBI rewarded its shareholders with a significant dividend of ₹15.90 per share and proactively planned for future growth by approving a ₹25,000 crore fundraising initiative for FY26. The primary challenge remains the pressure on Net Interest Margins due to the prevailing interest rate environment and the gap between loan and deposit growth.
Overall, the SBI Q4 results 2025, though showing a quarterly profit dip on account of provisioning, reinforce the bank's robust underlying operational performance and strong balance sheet management. Its market leadership, improving risk profile, and strategic capital planning position it well to navigate challenges and capitalise on growth opportunities within the Indian banking sector, supporting the generally optimistic outlook held by market analysts. Future performance will hinge on managing margin pressures effectively and successfully executing its capital augmentation strategy