SBI board approves fundraising of up to Rs 20,000 crore via bonds

Synopsis

State Bank of India's board has approved raising Rs 20,000 crore through Basel III-compliant bonds, leading to a share price increase of over 2%. While SBI shares have underperformed over the past year, they have shown recent gains, outperforming the Nifty in the last six months.

The board of India's largest public lender, State Bank of India (SBI), on Wednesday approved a plan to raise funds worth Rs 20,000 crore in INR through the issuance of Basel III-compliant Additional Tier 1 and Tier 2 Bonds.

The lender will issue bonds to domestic investors during the current financial year, SBI said in its filing to the exchanges.

After the fundraise announcement, shares of the lender rose over 2% to hit the day's high of Rs 834 on the NSE.

SBI shares have been laggards, declining nearly 6% over 12 months, though they have managed to deliver positive returns of 5% in 2025 so far.

The lender has lagged behind its peers in the PSU banking space. While the Nifty PSU Bank index declined by over 2% in the past 12 months, the broader Nifty gained 2.5% during the same period.

Its shares have bounced back in the last six months, gaining 10% and outperforming the headline Nifty, whose returns stand at 8.6%.

SBI shares are currently trading above their 50-day and 200-day simple moving averages (SMAs) of Rs 801 and Rs 789, respectively, according to Trendlyne.

The stock has also exhibited volatility with a 1-year beta of 1.1.

The public sector lender had reported a standalone net profit of Rs 17,035 crore for the quarter ended June 30, 2024, gaining 0.9% over Rs 16,884.29 crore reported in the year-ago period. The net interest income (NII) in Q1FY25 stood at Rs 41,125 crore, a jump of 5.71% over Rs 38,905 crore in Q1FY24.

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