State Bank of India (SBI) shares hit a fresh 52-week high on Wednesday, rising 1% amid a broader rally in PSU banks on Dalal Street.
The stock opened at Rs 875.20, touched an intraday high of Rs 880.40, and closed above its previous close of Rs 870.50.
What’s driving the gains?
The recent uptick comes after SBI completed the sale of a 13.18% stake in YES Bank—equivalent to 4,130 million shares—to Japan’s Sumitomo Mitsui Banking Corporation (SMBC) for Rs 8,889 crore at Rs 21.5 per share. Regulatory approvals had been cleared earlier, with the Reserve Bank of India granting its nod on August 22, 2025, and the Competition Commission of India approving on September 2, 2025. Post-sale, SBI’s holding in YES Bank stands at roughly 10.8%.
Following this transaction, SBI’s market capitalisation surpassed Rs 8 trillion, reaching Rs 8.05 trillion on Wednesday. This places SBI among only six Indian companies with a market cap above this level, alongside Reliance Industries (Rs 18.82 trillion), HDFC Bank (Rs 14.77 trillion), Bharti Airtel (Rs 11.64 trillion), TCS (Rs 11.11 trillion), and ICICI Bank (Rs 9.98 trillion).
Valuation and performance outlook
Brokerages estimate that the YES Bank stake sale adds 2–3% to SBI’s book value, already reflected in the stock price. Analysts expect the bank’s steady performance to continue supporting higher valuations. ICICI Securities has listed SBI as a top pick, citing tailwinds from potential interest rate cuts, GST reforms, festive-season credit demand, and the recent Cash Reserve Ratio (CRR) cut.
While minor slippages have been noted in unsecured retail loans, credit costs remain under control. SBI’s capital position is expected to strengthen further after the Rs 25,000 crore capital infusion in July 2025. S&P has projected that SBI’s risk-adjusted capital ratio could improve to 7–7.5% over the next 24 months, compared with 5.9% in March 2024, aided by India’s stronger economic outlook and sovereign rating upgrade.
Should investors consider buying?
CLSA has described SBI as a “truly valuable” stock, highlighting its consistent outperformance versus peers, stable valuations, strong loan growth, and improving asset quality. The brokerage projects that SBI could surpass a $100 billion market capitalisation within a year.
Nuvama Institutional Equities expects public sector banks, including SBI, to deliver healthy loan growth in the September quarter, though net interest margins (NIMs) may see a slight moderation. SBI is projected to post around 3% loan growth compared with the previous quarter, while NIMs could slip by roughly 5%. Despite this, the bank is expected to maintain a return on assets above 1%, supported by stronger core income.
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