MUMBAI: State Bank of India (SBI), the country’s largest lender, is expected to post a 5% year-on-year rise in profit for the December quarter (Q3FY26) to ₹17,810 crore, according to consensus estimates from a Bloomberg poll of analysts.
The state-owned bank had reported a net profit of ₹16,891 crore in the year-ago period and will announce its Q3FY26 results on 7 February. Analysts expect SBI to deliver strong loan growth for the quarter under review.
Analysts at Motilal Oswal said the public sector lender is poised for industry-leading credit growth of 13-14% year-on-year (YoY), driven by expansion in retail, agriculture and small business segments, a pick-up in personal loans, and selective utilization of working capital limits, even as the corporate capex cycle remains muted.
Corporate loans accounted for 33% of SBI’s domestic loan book as of 30 September 2025.
In November last year, SBI chairman CS Setty had said that he expects FY26 credit growth of 12-14%, higher than the 11-12% projected in August. The Reserve Bank of India’s measures to smoothen credit flow alone would lift industry-wide credit growth by about 100 basis points, Setty had said, referring to steps such as allowing banks to finance mergers and dropping an earlier proposal to bar lending to overlapping businesses, apart from rate cuts.
Management commentary on margins and loan growth will be closely watched, analysts said. Since the September quarter, the RBI has cut the repo rate by 25 basis points (bps) , taking cumulative rate reductions to 125 bps since February 2025.
“The bank expects NIMs (net interest margin) to remain unchanged at over 3% in Q4 FY26. SBI’s structural advantage, i.e., low-cost Casa (current and savings account deposit), pricing discipline and diversified loan mix, provide comfort that margins can remain resilient,” Motilal Oswal said in a note.
In the September quarter, SBI reported a nearly 13% year-on-year loan growth to ₹44.19 trillion, with sequential growth of almost 4%. Domestic advances rose 12.3% YoY. Including overseas operations, total loan growth stood at 12.7%, with the aggregate loan book at ₹44.2 trillion. Corporate loans grew 7% while retail loans rose 14% during the quarter.
Asset quality is also expected to remain stable. SBI’s gross non-performing asset (NPA) ratio stood at 1.73% as of September.
“Asset quality should sustain with curtailed slippages. This, with steady recovery and upgrade, will help sustain benefits on GNPLs (gross non-performing loans),” analysts at Elara Capital said in a note on 26 December. “With strong coverage levels, we expect credit cost to be curtailed.”
Credit cost refers to provisions and write-offs as a percentage of total assets.
Motilal Oswal said asset quality remains a key strength for SBI. “Credit cost in Q2FY26 was benign at 39 bps, reflecting disciplined underwriting and steady recoveries. We expect credit cost to remain low at 40-50bp over FY26-28 as well,” the brokerage said.
Kotak Institutional Equities estimates slippages at about 0.8% of loans and said it does not see fresh concerns around unsecured lending for the bank.