SBI Share Price ₹799 | Q1 PAT +12%, Support at ₹788

A Deep Dive into the Q1 FY26 Financials

The headline profit growth of 12% to ₹19,160 crore is a testament to the bank's operational efficiency and strategic focus. This growth was not a fluke; it was driven by a combination of a healthy increase in treasury income and a continued improvement in the bank's asset quality.

Net Interest Income (NII): While the bank's core NII, the difference between interest earned and interest expended, showed moderate growth, it was well-supported by robust non-interest income. The bank's treasury operations, in particular, proved to be a significant contributor to the bottom line. As interest rate cycles stabilize, a well-managed treasury portfolio can provide a substantial boost to profitability, and SBI's Q1 performance is a clear example of this.

Asset Quality: One of the most critical metrics for any bank is its asset quality. SBI continued to make strides in this area. The Gross Non-Performing Assets (NPA) ratio saw a further decline, reflecting the bank's disciplined approach to credit management and recoveries. Similarly, the Net NPA ratio also improved, which is a strong indicator of the bank's overall financial health and its ability to manage bad loans effectively. This improvement in asset quality reduces the need for large provisions, freeing up capital to be deployed for business growth and higher returns.

Operating Performance: The bank's operating profit also saw a healthy increase, showcasing its ability to control costs while expanding its business. The focus on digital banking and operational streamlining has contributed to better efficiency ratios. This robust operating performance lays a strong foundation for future earnings growth and reinforces SBI's position as a market leader.

Technical Outlook and Key Levels to Watch

Following the strong Q1 results, the SBI share price has been trading in a tight range, hovering around ₹799. For investors and traders, understanding the key technical levels is crucial to navigate the market.

Support Level (₹788–₹805): This range acts as a crucial floor for the stock. A support level is a price point at which the stock has historically stopped falling, finding buying interest that prevents further declines. The ₹788 to ₹805 range is a strong support zone, indicating that institutional and retail investors are likely to step in and buy if the stock dips to these levels. Holding above this range would be a positive sign for the stock's stability.
Resistance Level (₹805–₹822): Resistance is the opposite of support—it's a price level where the stock has previously found a ceiling, with selling pressure preventing it from moving higher. The ₹805 to ₹822 range represents the next major hurdle for SBI's share price. A decisive break above this resistance, especially on high trading volumes, could signal a new bullish trend and pave the way for a significant upward move.

The current trading near the upper end of the support band and the lower end of the resistance band suggests that the stock is at a critical juncture. The market is digesting the Q1 results and looking for a clear direction. A breakout above ₹822 could be the catalyst for the next leg of the rally.

Analyst View: An Optimistic Target of ₹925

Leading brokerage houses, including Motilal Oswal, have reaffirmed their positive stance on SBI, with an analyst target price of ₹925. This target implies a significant upside from the current trading price. The rationale behind this optimistic view is multi-faceted and rooted in the bank's strong fundamentals and favorable macroeconomic conditions.

Sustained Growth Momentum: Analysts believe that SBI is well-positioned to maintain its growth momentum, driven by strong credit demand and its dominant market position. The bank's focus on retail and corporate lending, coupled with its extensive branch network, provides a solid foundation for future expansion.
Improving Asset Quality: The continuous improvement in asset quality is a key factor. As NPAs decline, the bank's profitability is expected to improve further, as less capital is tied up in provisions. This positive trend gives analysts the confidence to project higher earnings per share (EPS) and a re-rating of the stock.
Valuation Comfort: Despite the recent rally, many analysts feel that SBI's valuation is still attractive compared to its private sector peers. Its strong balance sheet, coupled with its market leadership, makes it a compelling investment case for long-term investors.

The Broader Banking Sector Outlook

SBI's performance is a reflection of the overall positive trend in the Indian banking sector, particularly within public sector banks. A strong credit growth cycle, improving corporate balance sheets, and robust retail demand are all contributing to a healthy environment for banks. The focus on infrastructure spending and government initiatives also bodes well for corporate lending, a key area of strength for SBI.

While competition from private banks remains a factor, SBI's scale, legacy, and trust among its customer base give it a unique advantage. The bank has also been proactive in its digital transformation, ensuring that it remains relevant and competitive in the modern banking landscape.

Final Thoughts for Investors

SBI's Q1 FY26 results are a clear indicator of the bank's fundamental strength and its ability to navigate a dynamic economic environment. The 12% growth in PAT to ₹19,160 crore is a significant achievement, underpinned by solid treasury income and a continued focus on improving asset quality.

For investors, the stock's current trading at ₹799 presents an interesting situation. The immediate support at ₹788–₹805 and resistance at ₹805–₹822 are key levels to monitor. A move above the resistance could validate the optimistic analyst target of ₹925, as projected by firms like Motilal Oswal. With a favorable banking sector outlook and SBI's consistent performance, the bank remains a cornerstone of the Indian financial market, making its stock a compelling option for both short-term traders and long-term investors alike.

SBI Share Price ₹799 | Q1 PAT +12%, Support at ₹788–₹805