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SBIN: Subsidiary IPO Stake Sale Will Support Stronger Future Earnings Potential

Analysts Raise State Bank of India Price Target Amid Minor Valuation Adjustments and Board Meetings

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SBIN
AnalystConsensusTarget
Not Invested
Published 10 Nov 2024

Update shared on 03 Dec 2025

Fair value Increased 0.22%
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Analysts have modestly raised their price target for State Bank of India to ₹1,076.59 from ₹1,074.18, citing a slightly lower discount rate, stable long term revenue growth and profit margin assumptions, and a marginally higher forward P E multiple in their updated valuation model.

What's in the News

  • State Bank of India plans to sell a 6% stake, about 3.20 crore shares, in its subsidiary SBI Funds Management Limited via an IPO, alongside a 3.70% stake sale by co promoter Amundi India Holding. The offering is expected to be completed within the year (company statement).
  • The IPO of SBI Funds Management Limited will reduce SBI's holding from 62%, while Amundi India Holding will trim its 36% stake. This is expected to broaden the subsidiary's public float and may help unlock value from the asset management business (company statement).
  • State Bank of India has scheduled a board meeting on November 4, 2025 to consider financial results for the quarter ended September 30, 2025, signaling an upcoming earnings announcement (exchange filing).
  • The bank received regulatory approval to appoint 10 Chartered Accountant firms as Statutory Central Auditors for FY 2025 26, including eight continuing and two newly appointed firms, reinforcing its audit and oversight framework (regulatory correspondence).

Valuation Changes

  • Fair Value: Target price has risen slightly to ₹1,076.59 from ₹1,074.18, reflecting a modest upward revision in intrinsic value estimates.
  • Discount Rate: Assumed discount rate has fallen marginally to 14.77% from 14.78%, indicating a slightly lower perceived risk or cost of capital.
  • Revenue Growth: Long term revenue growth expectations remain effectively unchanged at approximately minus 1.80%.
  • Net Profit Margin: Forecast net profit margin is broadly stable, holding near 29.57% with an immaterial downward adjustment.
  • Future P E: Forward valuation multiple has risen slightly to 16.61x from 16.58x, indicating a small increase in the expected earnings multiple.

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Disclaimer

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