Morgan Stanley target price on SBI
Morgan Stanley raises the SBI target price to Rs 375 which means 14% up. SBI shares getting stronger due to better performance of subsidiaries in mutual funds, life insurance, and card businesses.
However, the brokerage has maintained it’s stock ‘ equal weight ‘ ranking, as its asset quality remains an uncertainty. Sumeet Kariwala, Stanley analyst, reported that (AMC, Cards, Life) subsidiaries ‘ market shares and profitability have steadily increased. Their contribution to the market cap of SBI is almost 35%, so the share gets strong support.
The SBI Card IPO will come on March 2nd and close on March 4th, the bank-owned Rs 2.800 crore. Up to 3,73 crore shares sold by SBI and Carlyle Group sold up to 9,32 crore shares.
The total asset under management (AUM) of SBI Mutual Fund is about 3.82 lakh crore. In the span of a year, the share of SBI Life insurance increased by almost 60%.
While SBI shares are small at 0.7 times the projected book value of FY21, Morgan Stanley noted that there is limited scope for re-rating given an uncertain asset quality outlook.
“Without the macro recovery, we expect the income outlook to continue to be weak and limited,” the brokerage said. “The quality of assets in the MSME / Agri segment is significantly uncertain in the face of rising rating defects and increased stress on asset quality.”
As many financial companies struggle in the world, Morgan Stanley said, there is a possibility that the state’s lander could be helped by some difficult entities.
Besides, the share trading with a loss of 12.70 points reached 309.25 INR with 3.94% down in NSE. Whereas in BSE, it trading with a loss of 13.40 points reached 308.55 INR with 4.16% down.