Comments
Benchmark indices ended positively on Friday with State Bank of India posting a net profit of Rs 4,050 crore for the March quarter.
The SBI scrip rose 5.82 per cent over Thursday to close at Rs 1,956 a share on the NSE.
Being a heavyweight on the Nifty and Sensex, the scrip pulled both the indices into the green at close.
The bank's results prompted short covering on the bourses in late evening trade.
Short covering happens when traders who have sold stocks start buying them back on positive news.
The Nifty closed at 4,891 up 21 points over its previous close. The Sensex closed at 16,153, up 82 points.
The rise was backed by substantial trading volume. On the NSE, 88.72 lakh shares of SBI changed hands while 21.12 lakh shares were traded on the BSE.
Market players said SBI's results came as a huge positive as analysts were expecting a net profit of about Rs 3,500 crore. “The market never thought that the bank would log more than Rs 4,000 crore this quarter,” said Mr. Dinesh Shukla, Banking Analyst, Sharekhan.
“There is expectation that the bank's slippage (increase in bad loans) this fiscal will be much below last year,” he said. Experts said that reduction in bad loans and adequate provisioning for them was clearly visible. The bank had set aside Rs 3,264 crore for bad loans last year which pulled its net profit down to Rs 21 crore. This year, despite providing Rs 2,837 crore for bad loans, the bank was able to make a net profit of Rs 4,050 crore.
> raghavendrarao.k@thehindu.co.in
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.