SBI share price jumps 5.5% to hit record high as PSU bank reports highest-ever quarterly profit in Q3: Should you buy?

SBI Q3 Results: Shares of India's largest lender, State Bank of India (SBI), rallied 5.5% to their record high of ₹1,125 on Monday, February 9, after reporting the highest-ever standalone quarterly profit for the December quarter of FY26.

SBI share price has now soared over 65% from its 52-week low of ₹679.65, hit in March 2025. Meanwhile, the PSU bank stock has gained 44% in a year, 12% in three months and 7% in a month.

The public sector banking major posted a 24.5% year-on-year (YoY) jump in standalone net profit to ₹21,028 crore in Q3 FY26, compared with ₹16,891.44 crore in the same quarter last year. The strong performance was supported by steady core income growth, a sharp improvement in asset quality and a one-time boost from its IPO-bound asset management arm.

On a standalone basis, a special dividend from SBI Mutual Fund played a key role in lifting profitability. The asset management subsidiary, which is preparing for an initial public offering, paid a ₹2,200 crore special dividend, which Chairman C S Setty cited as one of the factors behind the sharp rise in profits.

SBI Q3 Results Highlights

SBI’s operating performance remained healthy in Q3 FY26, supported by steady income growth and improving asset quality. Total income rose 9.7% YoY to ₹1,40,914.65 crore, compared with ₹1,28,467.39 crore a year ago. Net interest income increased by 9% to ₹45,190 crore, while operating profit surged 39.54% to ₹32,862 crore, aided by better operating leverage.

Margins were largely stable, with whole-bank NIM at 2.99%, while domestic NIM slipped marginally by 3 basis points to 3.12%.

Asset quality improved meaningfully. Gross NPAs declined 12.71% year-on-year to ₹73,637 crore, and net NPAs fell 15.74% to ₹18,012 crore. The GNPA ratio improved to 1.57% as of December 31, 2025, from 1.73% in September — the best level in two decades. Provisions rose to ₹4,507 crore from ₹911 crore, while fresh slippages increased to ₹4,458 crore from ₹3,823 crore a year earlier. On a consolidated basis, net profit rose 14.08% year-on-year to ₹21,876.04 crore, compared with ₹19,175.35 crore in the same quarter last year.

SBI management raises loan growth outlook

Commenting on the outlook, C S Setty announced an upward revision in SBI’s loan growth guidance for FY26 to 13%–15%, from 12%–14%, citing a rebound in corporate lending and sustained momentum in the retail segment.

“I see many areas where SBI is well positioned to take advantage of the emerging scenario,” Setty told reporters after announcing the results.

Setty said trade deals would benefit not just large corporates but also a wide base of small businesses. As of December 31, SBI’s total loan book stood at ₹46.8 trillion, while deposits rose 9.02% year-on-year during the October–December period. The credit-deposit ratio remained comfortable at 72%, offering headroom for further growth.

Looking ahead, management said banks must raise resources at competitive costs, with deeper corporate debt markets helping, while geopolitical tensions, global trade uncertainty, market volatility and commodity price swings remain key risks.

SBI stock: Should you buy after Q3 show?

Brokerage house Motilal Oswal said SBI delivered a strong all-round performance in Q3, driven by robust business growth, margin expansion and healthy asset quality.

“SBIN reported a strong all-round performance, led by robust business growth, margin expansion and healthy asset quality, with NIM expanding 2 bps QoQ to 2.99% and domestic NIMs at 3.12%.”

The brokerage said SBI expects NIMs to sustain at 3%+ in FY26 and over the long term, with profitability supported by fee-based income. Credit growth stayed healthy at 15.6% YoY, supported by a robust pipeline, while management raised FY26 credit growth guidance to 13%–15% from 12%–14% earlier.

MOSL raised earnings estimates by 3% for FY27E and 4.3% for FY28E, estimating FY27E RoA/RoE at 1.1%/15.9%, and reiterated BUY with a revised target price of ₹1,300.

Meanwhile, Seema Srivastava, Senior Research Analyst at SMC Global Securities, echoed similar views. She noted: State Bank of India delivered a strong and well-rounded performance in Q3 FY26, underlining the sustainability of its earnings recovery and balance-sheet strength. The 24.5% YoY growth in net profit to ₹21,028 crore was driven by healthy operating leverage, disciplined cost control and a sharp 39.5% YoY rise in operating profit.

She added that SBI’s credit growth remained broad-based and ahead of the system, supported by strong traction in SME and agriculture. Srivastava also highlighted resilient margins, improving asset quality, strong provisioning buffers and a comfortable capital adequacy position, reinforcing confidence in the bank’s earnings stability and balance-sheet strength.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.