Good evening ladies and gentlemen. I am Pawan Kumar, General Manager, Performance Planning and Review Department of the Bank. On behalf of State Bank of India, I am delighted to welcome the analysts, investors, colleagues, and everyone present here today on the occasion of the declaration of the Quarter 1 Financial Year 2026 results of the Bank. I also extend a very warm welcome to all the people who are accessing the event through our live webcast. We have with us on the stage our Chairman Sir, Shri C. S. Setty at the center, our Managing Director, Corporate Banking and Subsidiaries, Shri Ashwini Kumar Tewari , our Managing Director, Retail Business and Operations, Shri Vinay M. Tonse , our Managing Director, Risk, Compliance, and SARG, Shri Rana Ashutosh Kumar Singh , our Managing Director, International Banking, Global Markets, and Technology, Shri Rama Mohan Rao Amara, and our Deputy Managing Director, Finance, Smt. Saloni Narayan.
Our Deputy Managing Directors heading various verticals and Managing Directors of our subsidiaries are seated in the front rows of this hall. We are also joined by Chief General Managers of different verticals and business groups to carry forward the proceedings. I request our Chairman Sir to give a summary of the Bank's Quarter 1 Financial Year 2026 performance and the strategic initiatives undertaken. We shall thereafter straight away go to the question and answer session. However, before I hand over to the Chairman Sir, I would like to read out the Safe Harbor statement. Certain statements in today's presentation may be forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual outcomes may differ materially from those included in these statements due to a variety of factors. Thank you.
Now I would request Chairman Sir to make his opening remarks. Chairman Sir, please.
It gives me great pleasure to present the results for the first quarter of FY 2026, another milestone in State Bank of India's journey as the nation's largest and most trusted financial institution. The global macroeconomic environment has remained fluid since June till now amidst geopolitical tensions and tariff policy uncertainties that have increased. Central banks in many advanced economies kept policy rates unchanged as the last mile of disinflation turned out to be stickier than expected while also awaiting clarity on the trade tariff front and its implications for inflation.
Domestic economic activity held up in June with the high-frequency indicators pointing to mixed signals of improving prospects of Kharif agricultural season and continuation of strong momentum in the services sector on one hand, and deceleration of tax collections, industrial activity, and vehicle sales on the other. RBI estimate GDP for FY 2026 at 6.5% and inflation at around 3.1%. The MPC in its latest meeting, as you all are aware, has kept the repo rate unchanged at 5.5% and maintained a neutral stance. We closed the quarter with a 22.17% share of domestic deposits and 19.24% share of system-wide advances, reinforcing our position at the heart of India's banking system. Even more encouraging, we added 14 basis points of incremental loan market share year on year, led primarily by high return on risk-weighted asset segments such as retail mortgages and secured small business credit.
Why are customers choosing us in greater numbers when choice has never been wider? The answer lies in a virtuous combination of value, brand reach, and fairness. Low to zero fee structures on everyday products, transparent pricing of floating rate loans, and the reassurance of our blue- chip balance sheet continue to attract new depositors while deepening existing relationships. Our omnichannel reach, with 22,981 branches and 90 million users on our digital platform YONO, puts the bank in the pocket of customers wherever they are. Above all, we have maintained an uncompromising stance on charging what is fair, never what the market can be forced to bear in an era of rising rate volatility. Customers recognize and reward that stance. Second, our performance is powered by people. Attrition remained below 1% during Q1 FY 2026.
Banking here is viewed quite literally as a career for life, supported by clear growth paths and the sector's most extensive learning ecosystem. Our ambition is not merely to grow, but to grow profitably and sustainably. We reaffirm our structural targets of return on equity above 15% and return on assets of 1% through the cycle. The first quarter delivered an ROE of 19.7% and ROA of 1.14%, underscoring the resilience of our franchise even as funding costs normalize. Coming to the results for Q1 FY 2026, the net profit for Q1 FY 2026 stands at INR 19,160 crore, up by 12.48% year on year. At the end of the first quarter, our whole bank credit growth was 11.61% year on year, with the domestic credit growth at 11.06%, deposit growth at 11.66% year on year, while the CD ratio domestic was 68.88%.
Operating expenses have decreased by 21.92% during the quarter, with containment in overheads, which decreased by 37.98%. Our net NPA ratio has also declined by 10 basis points year on year and stands at 0.47%. Slippage ratio has improved by 9 basis points year on year and stands at 0.75%. PCR was 74.49%. The results for Q1 FY 2026 demonstrate the bank's ability to operate profitably at scale due to our substantial core strengths. These advantages stem from our institutional framework, which is guided by continuous improvement in processes and a commitment to fairness for our stakeholders. As I mentioned earlier, to keep our bank future ready and be ahead of the curve in partnering India's journey of Viksit Bharat and to realize the vision of reimagining the entire gamut of operational processes, preparation of a time-bound roadmap and facilitating the smooth transformation.
An initiative has been launched under SBI's operations process reengineering project called SARAL. It is a transformative step to reshape the retail operational processes across the bank. The way SBI serves its customers enhances employee satisfaction, productivity, and resource optimization. The objective of project SARAL is to simplify, automate, centralize, and outsource various operational activities of the bank encompassing retail operations, centralized processing centers, supporting retail operations, liabilities, third-party relationships, and retail loan collections aided by modern technological tools like AI to improve productivity and resilience while ensuring best-in-class customer service and employee enablement. Looking ahead, we expect credit expansion to outpace both nominal GDP and industry growth, driven by calibrated exposure to consumption-linked retail loans, government CapEx, pipeline, and green energy projects.
A disciplined risk-adjusted lens on every incremental rupee of credit, combined with our unrivaled low-cost deposit base, gives us confidence in maintaining healthy spreads without sacrificing asset quality. In closing, allow me to reiterate what defines State Bank of India. We combine skill with agility, innovation with prudence, and growth with inclusivity. Our dominant market share is the byproduct, not the driver of an operating philosophy that places the customer first, the employee at the center, the shareholder as a partner, and the nation as a beneficiary. As we advance into FY 2026, we remain steadfast in our promise to deliver superior returns, best-in-class service, and uncompromising governance. Together with your continued trust, we will keep creating value for every stakeholder in the SBI ecosystem. My team and I are now open to taking our question. Thank you.
Thank you, Chairman sir, for the presentation.
We now invite questions from the audience. For the benefit of all, we request you to kindly mention your name and company before asking the questions. To accommodate all the questions, we request you to restrict your questions to a maximum of two at a time. Also, kindly restrict your questions to the financial results only, and no questions be asked about specific accounts please. In case you have additional questions, the same can be asked at the end. We now proceed with the question and answer sessions, please.
Thank you. Sir, this is Ashok Ajmera, Chairman, Ajcon Global. Sir, the main silver lining in these results is maintaining or improving the net profit in spite of a very difficult quarter overall for all the banks where it has gone up substantially.
The overall group profit also has gone to INR 21,201 crore as against INR 19,325 crore in the last quarter, which is commendable. It means all other group companies are also contributing something to the profits of the bank. Having said that, sir, we had a sanctioned pipeline of, I think, INR 3.4 lakh crore for the last figure given. In this quarter, we have grown only by 0.80% in the credit. While I understand that, yes, there were the slackness transfers, this. Still, could we not have done a little better on the credit front with this kind of sanctioned pipeline? Are we reviewing those conditions of sanctions that people are not in a position to adhere to or fulfill those conditions, or they actually don't want to draw the money? This is. I'm not talking about the fresh sanctions.
Another point, sir, is on the fresh slippages, which have gone up to INR 7,945 crore as against INR 4,222 crore. That is why affecting our gross NPA, net NPA, I mean all other numbers also in this quarter a bit negative, making them a little negative. Of course, finally the other income dropped by substantial, almost about INR 6,500 crore, INR 6,700 crore, though offset by reduced operating expenses also by about INR 6,500 crore-INR 7,000 crore. What are the major factors in both this other income coming down and at the same time the expenditure also substantially coming down? I see one item is in the miscellaneous income. Other income as a miscellaneous income, which has gone down to INR 1,711 crore as against INR 4,575 crore. Similarly, in the expenses also, miscellaneous expenses have come down to INR 1,711 crore as against INR 4,575 crore.
These ultimately resulted in a little lower NIM, I mean below 3, now 2.9. Sir, your view on that? Any fresh guidance for the overall FY 2026 on all these major parameters, credit, deposit, and the business growth? Also, if you can, a little bit of cover in the recovery from return of account because our recovery otherwise also in this quarter from the main NPA account is also a little lower. These are a few. Treasury, of course, must be doing well, contributing, but has not contributed as much as we were expecting in the profitability of the bank. Last one, if you can just give a little color on that buffer provision of I think about INR 30,000 crore, INR 31,000 crore which we had. Have we used anything out of that in this quarter? These are the few questions in this round, sir.
Thank you, Ajmera Saab , for your compliments, but after your questions, nothing is left for the other analysts to ask. I think you broadly covered every question, but I'll try to answer a few and then leave something for the others also to ask. I think fundamentally you are coming from quarter to quarter. The ideal way is to look at year on year because this quarter on quarter comparison, particularly from Q4 to Q1, does not give any indication because Q4 generally is a good quarter across the bank, and SBI is no exception to that. Particularly the items which you mentioned in terms of miscellaneous income, other income, recovery, almost all these elements show uptick in the Q4. I think the ideal way is to compare with the Q1. Still, your question in relation to the credit growth quarter on quarter being low.
I would like to answer that question, but if you see most of the segments in the retails, we have done well barring Xpress Credit. We could have done better, but we hope to do well going forward in the Xpress Credit. Home loans, we have done extremely well, 15% growth rate year on year, and overall in the quarter also we have done on this segment. What has been the challenges on the corporate credit side? It is not in terms of what you said, whether terms are being renegotiated. We have not seen that, but what we have seen is that a lot of prepayment has happened in any declining interest rate cycle, particularly on the loans which are fully disbursed, one or two years old, the cash flows are stabilized, everybody wants to refinance and negotiate for repricing. There, some of the exposures we let go.
We almost had around INR 12,000 crore prepayments because we did not want to go to that level of pricing considering the risk pricing in view. So, around INR 12,000 crore is something that impacted the corporate in the current quarter by way of prepayments. We also had last a few large corporates accessing the CP market because CP rates have become extremely competitive, and we wouldn't have afforded to give that rates. That also led to almost INR 16,000crore-INR 18,000 crore movement towards CP market by the corporate. This, in my view, is a recurring phenomenon whenever the rates of interest are on the downward movement. Pipeline, yes, we still have a robust pipeline.
We almost have INR 7.2 lakh crore pipeline, both on the sanctions but not disbursed as well as proposals in pipeline, which gives us confidence that we will be able to get back to a double-digit corporate credit growth in the next quarter onwards. Slippages, again, the comparison should be with the Q1 of the previous year. If you see that, I think very marginal movement. Let me also assure you that there is no concern on the asset quality in any of the segments you have not seen. Even among those slippages which we have witnessed in the Q1, as it happens every Q1, there has been a significant pullback as we speak in the last 30 or 45 days. There is no great concern on the slippages in any of the sector.
Recovery, yes, we had given a guidance of around INR 7,000 crore-INR 8,000 crore in recovery from AUCA, which means that INR 2,000 crore every quarter, but it is not uniformly distributed. Again, you see my Q1 of previous year, it is almost similar to what we have had now. We are confident that we will be able to achieve the guidance we have given on the recovery front. The buffer provision, we have not touched the buffer provision at all. Many other questions, what pullback? Full bank has already mentioned around INR 1,300 - INR 1,400 miscellaneous income again in Q4. Ajmera Saab, again you mentioned Q4 comparison. In Q4, we have a lot of miscellaneous income coming by way of inspection charges. Locker will come in Q1, inspection charges, folio charges.
There are so many miscellaneous income items which are recovered at the year end which are not available in Q1. Anything else which I missed out? No, no. SMA numbers also have moderated. That is only, I think, again you have to see Q1 comparison. There's no untowardable. Yeah.
Much profit in the treasury. I mean, we could have offset or increased the operating profit instead of a decrease in this quarter.
No, again, you are again Q4, you are comparing very marginal decline. I think you request you to.
What happens, a lot of water gets flown. In the last quarter, in this quarter, our figure numbers base, everything changes.
Yes.
We cannot also at the same time compare with Q1 of last year.
There are variations. I just would like you to request a Q1 because there are variations in income booking and expenditure booking.
There's a lot of expenditure gets booked.
What I actually wanted is nothing unusual, nothing one-off or nothing of that kind.
No.
Just one point I will answer you, for me, treasury, even if you compare the Q4, I think in the area of profit and account of sale of securities, we are more or less the same in Q4, but only in terms of forex. We always say it's a combination of trading income versus the derivative MTM movement. This quarter, we did not experience the same positive movement as Q4, which is beyond the bank's control as well as the market factor movement. That's the only reason, otherwise the core income is continuing to contribute.
All right sir, thank you.
Hello sir. Hi. Congratulations sir. I had a couple of questions.
Firstly, on Xpress Credit, so it's not been growing and we have a lot of government employees, so they should not be really affected by the macro movements. Plus, we also have a lot of repeat business in Xpress Credit. Why have people stopped taking that repeat business? It appears to be the case, right, that even the repeat business would have been lower because Xpress Credit has not grown for a few quarters. Why have people stopped taking repeat business on Xpress Credit as well? That's my first question. Second is, what is the margin outlook from here on? Basically, they've declined 10 basis points. That's possibly a little better than what we had expected. How does it pan out from here?
Thank you. Xpress Credit, we have had some systemic improvements.
When we saw that some of the low net monthly income group, even among the government employees, which are predominantly our customer base, we have seen some over-leverage happening there. Such segments have been temporarily, we have had relook change, that is, in the last year in Q1, we have seen that NMI, EMI profile of our customers, even at the lower end of the income segment, has improved. We are again reactivating some of these segments which we have not considered earlier to be brought back. You're right. I think Xpress Credit is basically a rollover product where people take, close, and then take, and many a time their income levels also go up and they take more loan. That is happening, otherwise the portfolio would not have remained at INR 3.5 lakh crore.
The amount of repayment which happens every quarter is phenomenal in this because while it is given for six to seven years, the average tenor of the loan is two to three years only. That means, you know, faster repayment happens here. With these improvements, what we have done is we completely reoriented the process in the last quarter. Also, I did mention that we have made it completely a digital process. This also had taken some time to stabilize. People still have to come to the branch and sign the paper because in some of the areas, digital documentation has not been rolled out. We are seeing a good comeback in the current quarter. Q1 was slightly disappointing for us. We have expected the growth to come back. In fact, I said that we may reach double-digit growth in Xpress Credit.
It is taking a slightly longer time to get back to that growth rate. In this quarter, I'm seeing a good development there in Xpress Credit. There are also some practical difficulties. For example, in the defense area, our major segment of customers, during this, you know, disturbances, many of these defense areas were not available for access. Neither they could come to the branch or branch people could not go. That also had some impact. I'm not saying it's a major impact, but all of them collectively have resulted in lower growth in Q1 than what we anticipated. I'm seeing a good growth coming back there. As far as margin outlook, we are still standing by our 3% guidance on NIM. As I mentioned earlier, I think the NIM trajectory will be U- shaped. It probably will come down in Q2.
While we are not hazarding a guess how much it will come down, I think it will definitely improve from Q3 to Q4 for two, three reasons. One is the deposit gets repriced, predominantly the fixed deposit gets repriced. We will also have the full benefit of savings bank account rate reduction and the CRR yield, I mean a NIM contribution which will come from the CRR cut. We are sticking to our 3% guidance. Thank you.
Excellent response to QIP. Great management and a very good fair price. Also, it's really phenomenal the way every member of the board managed. You got a good price, phenomenal response, you know, largest QIP ever, over INR 1 lakh, so heads off to you. And good numbers. Now, couple of things and also good numbers. Quarterly numbers, credit growth, NI, ROE of 19.7%.
Good results by the funds business and insurance business. They have given a boost. Couple of things come to the mind on particularly questions where you can update us. One is a slide number 23. Now, what we see, a little number, we can see with little skepticism that 7.88% growth in operating expenses, which is very good and which gives us cost to income ratio of below [0.5x]. Now, when we go on identifying the items, now below 8% is a little skeptical. That's what I said, would like to know when on an annual run rate basis what can we expect. Of course, the size of business will also grow, so can we expect the cost to income at 4.9 or below to the ground level numbers? You would know. Second question is there's a huge challenging uncertainty which you addressed in the press conference also.
This has resulted in temporary supply chain disruption in trade manufacturers who are dependent to a good extent on exports, whether in India and abroad. Now this supply chain disruptions, cancellation of orders, maybe even a 1 billion order cancellation by Walmarts a nd the like, can disrupt and have a spiraling impact on the business working capital, receivables, inventory, and the spiraling is more worrisome to all of us. Not being a premier bank, would like to know at the ground level, you would be knowing last few days the cancellation of orders, so shipments getting held up, and that can have a huge impact. Maybe disruption could be a few months. Would like to share whether we need to worry about it or the ground level [VMI] numbers and growth numbers seem apparently good, and how do we look at it on a sustainable basis?
Thank you. First of all, I was waiting for someone to compliment on the QIP, so show the QIP slide. I'll just spend a couple of minutes. Of course, it's well known what we have spoken widely about that, but I must thank all of you for the confidence which you have. I think some of you have definitely helped us to reach out to the investors. Even if some of you have become part of the deal, some of you have not become part of the deal, but your engagement with SBI and your engagement to help us to reach out to the investors, I must acknowledge through this forum for those people who are present here and also on the call.
I think I must, I must, I must thank and also maybe I'll request my team to acknowledge by way of an applause for all the investors. It's not only, I think, the largest QIP ever, largest equity issuance, but what was heartening is that more than 60% of the investors are cross-border investors, foreign investors who had bid for that, and we were happy to see some of the investors for the first time looking at our stock, which shows the confidence in the institution and also the confidence in the Indian economy. That's one. The other one is in terms of cost to income ratio. I think what you have observed is right. I think this historically low operating expenses quarter, year on year, are difficult to replicate. There could be some increase in operating expenses going forward.
In Q4, there have been some upfront loading of the expenses. That also is one of the reasons why you see a lesser growth in operating expenses. Our effort, what I mentioned in my speech, also the project SARAL, what we keep talking about, is aimed at increasing the productivity. While we still are sticking to our guidance that the cost to income ratio, our effort is to keep below [50%]. I'm not giving any number whether it is [47%, 45%], the effort is through the cycle. We would like to maintain the cost to income ratio below [50%]. I think that is something what I wanted to convey. As far as supply chain disruption and the tariff order, I think I did mention in my press conference and I would like to reiterate there are two elements of this tariff narrative. One is the direct impact on the sectors.
There are four, five sectors we're all familiar with which probably have more impact. These sectors from a banking system perspective do not pose any systemic risk because they are not very large exposures. On this sector, definitely for SBI , the very, very minor exposures on these sectors, number one. You need not worry about the institutional credit quality point of view. From a larger perspective, I think more than the direct impact, the uncertainty surrounding the tariffs both in terms of the investment decision, in terms of the trade disruptions offtake is something what we should have. Definitely we have a concern and I'm sure the Government of India is working very hard to ensure that the issue of tariff related negotiations are concluded at the earliest and the clarity emerges there while keeping the nation's interest paramount.
I think we fully respect and support that approach. From the ground level we do hear anecdotally that there are some people who want the shipments to be held on. We have not heard so much to cause concern at this juncture. This is what I can respond immediately. Let us wait and watch how it is going to evolve. Thank you.
S ir, s econd thing is on the monetization of assets, particularly as bank which we always discuss as intrinsically higher value. Now once part of a deal was signed for a small portion, not a full portion. Now that portion, the money doesn't come for a long time. Then the price announced 21.5 doesn't it become and the market has also gone up significantly. Should not we expect upward revision in the price c learly?
T hese are binding offers.
In time of the payment is also important.
The binding offer is valid for certain period of time. That period is not elapsed.
O kay, i t will remain, maybe in the next tranche would be higher price.
Next tranche has no control. I mean no limitations on our either pricing ability or when do we exit? There are no such restrictions, we are free to look at that opportunity.
Another compliment to you. Your bank is doing well in case of large fraud accounts and maintaining your highest level of ethics and follow-up action. Whoever is a borrower, large accounts, you have done well on fraud accounts. Keep it up. We are all behind you. Hope you get some recoveries.
Yeah. Hi sir. Yes, this is Nitin Ag garwal from Motilal. Yeah, so one question around asset quality.
While you indicated that things are all going good and there is no risk lurking around, given how the credit environment is shaping up and we are seeing very high delinquencies in unsecured segment with many other lenders, do you see any risk of spillover of the same to SME, MSME which traditionally have been more vulnerable segments?
Unsecured personal loan. See, in our SME book, barring the micro loans which are essentially below INR 2 0 lakh, you know, the government-oriented schemes and all, most of the lending either is a secured lending or it is backed by the CGTMSE guarantee. From that angle, I think we need to say that, you know, we are well protected there. In terms of the asset quality, we have not seen any great concern on the SME book so far. The underwriting of SME also has improved tremendously.
As I mentioned last time, also the business rule engine which we have adopted now, we almost have crossed more than INR 65,000 crore worth loans which are processed using the business rule engine where the data sets are much more robust. We have GST data, income tax data, our own account statement. We are able to and historical default data and we were able to develop a rule engine where the assessment in my view and underwriting has tremendously improved. While SME definitely is more vulnerable than any other segment, we are confident that the kind of loans which we are underwriting today may not pose any major problems as far as unsecured personal loans is concerned. As we keep saying, our Xpress Credit is more secured than the secured.
Right. The other observation is around the cost of deposits.
We have reported a small rise in cost of deposits this quarter while we have seen stagnation or improvement by many other banks. How to look into it? Are we expecting this to inch up further before it stabilizes and comes down? Therefore, the margins outlook, any color like when will you see the bottom, 2Q or can it get delayed to 3Q a lso?
I think the cost of funds uptick is essentially a significant movement towards fixed deposits. If you see our FD growth rate, it is almost 14% and a very large FD book at that. Some of the rate cuts on the fixed deposit that we have done, we will get the benefit in the quarters going forward, and a fixed deposit book also will get repriced predominantly in the next eight to 12 months, every month. Of course, there is a repricing which happens on maturity.
The reduction in CASA year on year also, and particularly from Q4 to Q1, that also has impacted the cost of deposits, but I am sure that it will moderate.
Right, sir. Lastly, on the ROA, wherein you have suggested to maintain ROA above 1%, now this quarter we are at 1.14%. While of course it has come in on the back of significant treasury gains, does this imply that the 2H ROA will be lower than 1H?
2H will be lower than 1H because I think there will be some contribution coming from the CRR cut and many other things which are in the offering. That will also improve the earnings, NIM will be improved, and ultimately, some impact will be seen if the treasury gains are not as robust as we are today. I believe that is the reason our guidance is one and above.
We are not giving what level of above that one, but we are sticking to our 1% guidance on the ROA.
Thank you, sir, and wish you all the best.
Hi sir, this is Bhavik from InCred Capital. Sir, as you rightly started, there is a lot of pricing competition on corporate and NBFC loans. We have cut SA rates, we have cut term deposit rates on 65, 70 basis points. Do you incrementally take the lead and plan to cut term deposit rates further?
We will see. I think how it is playing out is not appropriate to comment at this juncture, but we will look at it.
Earlier also, I mentioned that deposit for us is a franchise activity, and as I mentioned in my inaugural remarks, though it sounded a little philosophical, I think we want to take care of all our constituents, so we never want to shortchange our depositors, and we want to provide, and we have a large base of savers and also senior citizens. We need to take care. While I am not ruling out, I think we will be mindful of those elements also before we take the rate cut on the deposits.
Okay, I'll answer two more questions. One, as in your interest earned, is split into three, four buckets. Interest on what we have earned on RBI and interbank borrowings, that has kind of gone up from INR 1,000 crore -INR 1,800 crore.
Which item is that?
It's within the interest earned.
Similarly, we have seen a sharp drop in the interest expense. Again, that is from whatever we pay to interbank and RBI. What kind of operations were there? Any color would be helpful.
We don't give that kind of granular data. Both our market borrowing and market lending are depending on the liquidity management. I think it's not in terms of supporting any credit growth. You don't borrow to support the credit growth. It is essentially the liquidity operations. Not any great variation in that, but the cost will come down because most of the TREPs and CROMs rate have significantly come down there.
Okay, answer last question. Sir, NSE stake. What methodology do we use to value the result? The stake in NSE Ltd?
NSE, what is the methodology we use? Is it appropriate to talk about an individual investment on that?
When the NSE gets listed, you will come to know what methodology we are adopting.
Okay, sir. I just wanted to understand what—
No, no. I think that's not appropriate. Thank you. Where will we stop? Yeah.
Sir, Sushil Choksey , Indus Equity . Yes. Congratulations on a very successful QIP. First question is, your press meet, you did indicate that you have INR 7 lakh crore of pipeline sanctioned. What is visible to you which is under assessment? Seeing the current condition led by U.S. tariff, global challenges, India may accelerate domestic development of infrastructure or other schemes led by central government or state government. Keeping in view that our negotiations don't go through, do we sense that government has already started about roads in the press, but power plants are happening because of demand led by data center or various other factors including manufacturing PLI schemes?
A lot of manufacturing is coming in India and domestic consumption is also increasing. Any sense on this infrastructure spin would show a different color starting second half?
I'll just give some brief and then I'll ask Mr. Tewari to supplement me. The government capital expenditure, there's a good visibility of government capital expenditure. I think to the extent what they've committed so far, we love to see as we progress whether they're going to further enhance that INR 11.5 lakh crore commitment they've given on the capital expenditure front as far as infrastructure is concerned. We are seeing good inquiries on the infrastructure. In fact, some of the power-related, other than the simple renewable energy like solar, wind, we are also seeing the green hydrogen and many other new emerging areas people are discussing with us. We are looking at those opportunities also.
As far as the pipeline is concerned, I'll ask Mr. Tewari to supplement.
To your specific point, whether in response to the uncertainty by tariffs, is there a government plan to speed up or enhance the investments? We have not seen that. It's too early. They are still finalizing what they want to do. As rightly pointed out by Chairman, that INR 11.15 lakh crore, plus the inquiries we are having in terms of not only the power on the renewable side, but also thermal, because clearly the baseload issue hasn't gone away. That is why the power sector is a big place where a lot of investments are planned and also already sanctioned, and these will be disbursed. There's no question of these not being disbursed and all similarly in other areas.
For example, the commercial real estate, both for the malls and the real commercial LRD kind of loans and also residential on the premium side, this again is seeing a lot of uptick. Mumbai city itself has so many inquiries for the slum redevelopment schemes and other similar activities. We are seeing good opportunities there. It's still a lot of decision, planning stage, discussion stage, etc. There's one very large development which is happening near the airport. You're aware of that. All of this is happening. Having said this, there are some players who are kind of putting things on hold or which they have planned earlier and maybe wanting to know more in certain sectors. Some are seeing more consolidation in, cement f or example, we're seeing more consolidation in steel. Again, there are some plans, but again, they are colored by some developments which you are aware of.
Therefore, it's overall a slightly mixed picture. As rightly said by Chairman, overall we still think that we might have this year still at around 10%, 11% in corporate growth right now. It seems very low. Ultimately, I think the kind of project pipeline we have, and we have the strongest player in the project finance space. We do hope that 10%, 11% is what we will end up achieving. Thanks.
Most of the banks in RAM sector have shown 17%, 18% growth. Do you think the second half, specifically after the festive seasons or starting the festive, that ramp will get accelerated? Or do you think the numbers are at peak?
I n our book, I think home loans, we have done 15% on a base of INR 8 lakh crore. I think that's a phenomenal growth.
I definitely visualize that the unsecured personal loan segment and auto loan segment—auto is not all that doing well in terms of the sales, and it's also getting reflected in the auto loan segment. These two will pick up in the second half. That is what our assumption is, and that will have some spin-off effect on the SME also. SME, my view is that 19%-21% growth rate is very robust. I don't think it will further get into a higher mode. Even if we are going at 19%-20%, it is a good growth rate to have.
You are enabling with a lot of initiatives with digitization processes. I'm sure you are doing an accelerated development, whether new products or AI or transformation journey is the current phase. Will your digital expenditure substantially increase, or would the stable number continue?
No, we've been investing in technology and digitalization significantly, and many of these initiatives we spoke about are not very costly events. It's not that we have to spend a lot. It's more in terms of the re-engineering. That means you look at the process and see what are those redundant steps which we have not looked at for quite some time. Another element is, if you really ask me, what would be the major investment coming forward would be a buildup of our own AI stacks, which we are undertaking. That doesn't require any great amount of capital expenditure.
Any plans on listing any of your other subsidiaries?
As we mentioned, we definitely have a couple of candidates for listing, but the timing is not very—there's no sense of urgency there, I believe. You all have helped us to raise INR 25,000 crore now.
I think the markets are in good shape despite the global challenges. The only thing is the right choice because you started with ARCIL and offer for sale a little bit. There will be multiple other things.
A lot of things which we have been participant, you know, ARCIL, NSDL and so variable opportunities are there. We will definitely look at.
Thank you for answering all my questions. Good luck for the year.
Yeah. Hi sir, this is Jai Mundhra from ICICI Securities. Sir, first on your margins you said 3% for the full year. This is global or domestic?
Domestic.
Okay, sure. Secondly, if you can call out the amount of bulk deposit that we have, you know that probably will reprice at a much faster pace. If you have that number. How much?
We do not disclose.
The second is around SME. Right.
We have been doing very well for the last nine, ten quarters. 15%+ growth on a consistent basis. Would you have any visibility on the self funding ratio? Usually a lot of other banks when they go reasonably well in SME, I mean they get to own the float also in that business because these typically may have only one or at max two banks. Would you have some visibility that you know what is the kind of self funding that we are getting from these SME pool now?
See, most of these SME loans are sole banking loans. Very few have consortium arrangement, which means that the whole cash flow is routed through our cash credit accounts if that is what you are looking at. Yes, we have a good visibility of the cash flow and we actually insist that the whole cash has to be routed through us.
That is one of the preconditions.
Sir, breakup. Only if you have the slippages breakup for this quarter especially in agri and retail and maybe Xpress Credit.
You have that? Yeah.
Sir, our other retail. Right, so Xpress Credit and then other retail. Just ballpark. I mean what are the key products there apart from home loan, auto loan and gold loan? There is some other.
Yeah, other p- segment loans are educational loans mainly and pension loans. We also have pension loans and loan against fixed deposits. That's also a very popular product in our book.
If you have the quantum there or the LAP. Sir, do you do LAP or?
We don't do much, we do LAP but they are not very significant. Even if it is there, it will appear in the home loans category.
Sure sir, during the time if you can just quantify the number of education that's.
That's not a big number. Anyway, education loan, education we will be able to give the breakup. There's absolutely no.
Thank you sir.
Can I respond to the slippages part, sir? In [SME the slippage is INR 2,618 crore. SME is INR 2,680 crore. Agriculture is INR 2,464 crore, personal is INR 2,602 crore. Total is INR 7,746 crore. There is some small slippage in CCG, INR 196 crore. The total is INR 7,942 crore, out of which INR 1,585 crore] has already been pulled back.
Thank you, sir. All the best.
Yeah. Hi, this is Piran Engineer from CLSA. Just a couple of questions. Firstly, on the power sector, we're seeing that NBFCs are growing faster than banks. Last few years, since this power sector CapEx has taken up, anything for us? Our book is flat YoY. Can you just give us some commentary of why this is happening?
Are the risks still high in this segment? Because the yields are pretty good, north of 10%. Why aren't banks participating in this business?
I don't think there is any. We are extremely oriented towards the renewable energy which is coming up. Even on the thermal capacity addition which is happening, I think SBI is there. Some of the NBFCs you are mentioning are focused on some of these renewables, for example, so obviously their book will be much larger than what bank books are. The three NBFCs we all know are actively involved because their mandate is to finance the power sector. Their book will always be larger and they're also diversifying their book from the conventional DISCOM and GENCO funding to renewable financing in the private space. That is where you see the growth coming for them. We are not staying away.
We are very actively involved in this space.
Our growth is like 1% YoY.
The challenge in the renewable is the typical short-term execution. Their execution is just less than 12 months. The moment the project is up and running, either they will go for refinancing or most of them are moving into InvITs also. That gets refinanced and the churning happens faster in the renewable space.
Understood, thank you. Secondly, when we talk about our NIM trajectory and aspiration to reach the exit FY 2026 NIM at par with exit FY 2025, what assumptions are we making on further— I think someone asked this question— on further rate cuts? Are we assuming that we'll cut rates further to reach that NIM or is it simply just repricing of term deposits which will help us get there?
Are we assuming CASA ratios to also decline like they have been declining for the banking sector?
Our assumptions are broadly the following. One is you're right. I think more than the further rate cards we are building our model based on the repricing. As the book gets repriced, that benefit will be available both on the savings bank and as well as fixed deposits. Right. The second thing also considers the CRR cut. Almost INR 52,000 crore gets released, which is not currently earning anything. Right. That will also add to the NIM. We believe that the policy decision of not cutting further rates has established that the retail segment, the rates will be stabilizing on the asset side, so all these elements give us confidence that the NIM trajectory is what we have assumed.
Understood. Thank you, sir, and wish you all the best. Thank you.
This is Anand Dama from Emkay Global over here. Sir, you said that there will be a release of about INR 52,000 crore from CRR. We have INR 25,000 odd crore coming from capital side. Do you believe that the 12% growth that we have now at this point of time can become 13%? Hopefully, mortgages also should see a pickup in the second half of the year with the rates coming off. We are not seeing at this point of time any signs. What is your view on the overall growth and particularly the mortgage growth if you can share?
The liquidity and capital has never been a constraint. Even earlier also we had adequate CRAR to support the credit growth.
While this INR 25,000 crore definitely has augmented our capital, it was as we mentioned earlier also, it was mainly for confidence capital or improving our CET-1, so need not be linked to our ability to fund growth. The growth capability was always there. In terms of the liquidity, again, we had one of the lowest CD ratios and we had excess SLR of almost INR 3.5 lakh crore. These are not going to really move the needle. This is not about supply issue ever for us; it was always in terms of what demand is coming in the market. That's the reason we are still sticking to 12%. As the uncertainties get cleared, probably there is a potential upside of 13%.
Okay, and on mortgage, if you can just share some info because we're not seeing any pickup on the ground as of now despite the rate cuts which have happened.
You see for 15% growth rate in home loan.
Yeah, that is for us. Otherwise, when we speak to a lot of other players, they're saying that.
I don't know, I think at least we are seeing that good amount of sourcing of applications, sanctions, disbursements, and we probably have historically high level of sourcing going on now as we speak.
Sir, secondly, do you expect that the ECL norms will come this year now?
ECL? Yeah, no idea on that. Thank you.
Thank you, sir.
Kunal Shah here from Citigroup. Firstly, on Xpress Credit. We have been very comfortable with less than 1% NPA over there. Now it's gone up to almost 1.2% and that too on a flat book.
Where do we see eventually GNPAs in Xpress Credit stabilizing? Do we see further inch of the way it has been like last four, five quarters or most of it is now recognized?
The absolute number has not moved much. It's only the base effect because it's almost stagnant. The book is at the same level. That is actually resulting in the uptick. We don't see major concern in terms of the asset quality in Xpress Credit. We may still have some pullback happening on that.
Okay. If you can share AFS reserves number, that would help. Yeah.
Do we have AFS reserves number?
Y eah. INR 7,000 crore?
INR 7,700 crore.
Last time it was INR 6,600 crore.
Some accretion is there?
Yeah. Thanks.
We have a few questions coming in through the online webcast now. These will be addressed by the Chairman. Sir.
The first question is from M.B. Mahesh from Kotak.
If you could give us the income from written off accounts Q1 FY 2026, INR 1,229 crore. I think it's mentioned in the presentation. Q1 of FY25, it was INR 1,008 crore. Kiran Shah, can you please give the breakup percentage of your loan mix in terms of based on external benchmark like repo? Other than fixed rates, our MCLR book is 30.69%. EBLR is 30.24%. Fixed rate is 22.58% and others, which includes T-bill link pricing, is 15.93%. Saurabh Kumar, what is quantum of IT refund in last Q4 FY 2025 and this quarter? This quarter we didn't have any IT refund. IT refund in Q4 was INR 1,319 crore and IT refunds in the corresponding period last year was also nil. Armaan Nahar from Blue Sky Fintech. Do you think pain in unsecured segment MFI have come to an end?
I think we never had any issues in our unsecured book as well as our MFI exposure is minuscule, but we believe that from a system point of view there is definitely an improvement in the asset quality in the unsecured loan and MFI segment. While a lot of upfronting in terms of cleaning up the book by MFI is also one of the reasons why we believe that situation is better now. Deepanshu, show how QIP funds will be used in future. As I mentioned, it is not in terms of growth capital. It is definitely to augment our CET-1. Today, after this capital raise, the bank assesses the available buffer is 233 basis points over minimum regulatory capital. We believe that this supports adequately our growth plans.
Vishal Gutka from ASK Investment Manager, what is driving such sharp increase in current account balances given other peer banks are grappling to collect current account balances? The current account growth has come from both government and non-government accounts. We definitely focused on many initiatives such as creation of specialized hubs and deployment of dedicated workforce. Relationship managers for current account also are there to look specifically into it. More than the quarter-end balances, what we are witnessing to our pleasant surprise is the quarter-on-quarter improvement in the daily average balances in the current account. Chintan Joshi, can you give us color on what your weighted average savings deposit cost is? The average weighted average cost of saving bank deposit as in June 25 is 2.68%. Radhika Kant ikar from HDFC ERGO, what is the outlook for strategies?
We had slippages of INR 7,945 crore Q1 FY 2026, out of which there has been some pullback. We are still sticking to our slippage ratio to contain the slippages below 6.6%. Rohan Mandora from Equirus, why did your cost of deposit increase during the quarter? Also, what is the share of bulk deposits? I already explained that the CASA ratio decline as well as TD significantly increasing has contributed to the cost increase, but we expect it to moderate and normally we don't disclose the bulk deposit related data. Rohan Mandora again, what is driving growth in SME segment? Is it largely working capital demand? Any signs of initial stress that we may be seeing in the SME portfolio and our asset quality in Xpress Credit has held up well, but we have slowed down the growth in that segment. Is there a lack of good quality demand?
I think both these questions I've answered, I don't want to repeat again. Sukrit D. Pate l, as SBI continues to scale its digital banking footprint, how are you envisioning the integration of AI-led underwriting and behavioral risk scoring across YONO and SME platform in the next quarter as we continue enabling our digital document execution for the BRE and non-BRE journeys under LMS, that is Loan Management System. You also have auto renewal journey on the BRE loans, integration of vendor verification module and many things. What we are using, AI also will be there. As I mentioned, AI stack is something which we are setting up, so this would help us. Underwriting BRE is essentially using the machine learning models, and we probably utilize AI to set the patterns. Today we are using predictive AI models.
We also intend to use the GenAI models going forward, and with customer migration to the alternate channel, end-to-end digital channel products will be launched. I think this is broadly the questions from the calls. Thank you very much.
I trust all the questions have been addressed. We'll be happy to respond to other questions in offline mode. Let me end the evening with thanking Chairman Sir. Sir, MD Sirs, DMD Madam, top management team, analysts, investors, ladies and gentlemen, we thank you all for taking time out of your schedule and joining us for this event. To round off this evening, we request you all present here to join us for high tea, which is arranged just outside this hall. Thank you. Thank you so much.