SBI Card Q4 Results: Profit Rises 11% On Higher Income

SBI Cards and Payment Services Ltd.'s fourth-quarter profit rose, surpassing analysts' estimates.

The company's standalone net profit increased 11% year-on-year to Rs 662.37 crore for the quarter-ended March, according to an exchange filing on Friday. Analysts polled by Bloomberg estimated a net profit of Rs 577.71 crore.

SBI Card Q4 FY24 Results (YoY)

• Total income up 14.2% at Rs 4,474.57 crore. (YoY)

• Net profit up 11% at Rs 662.37 crore (Bloomberg estimate: Rs 577.7 crore).

• GNPA up 12 bps at 2.76% (QoQ).

• NNPA up 2 bps at 0.99% (QoQ).

The company's total revenue rose 14% year-on-year to Rs 4,475 crore.

Its expenses surged 15% year-on-year to Rs 3,586.41 crore. Of these, finance costs rose the most by 42.6% year-on-year to Rs 723.8 crore. However, employee costs fell to Rs 132 crore, as compared with Rs 152 crore over the same period last year.

For the quarter-ended March, the capital adequacy ratio stood at 20.5%, of which tier-1 was at 16.5%.

Asset quality for the non-bank financier worsened with gross non-performing asset ratio at 2.76% of gross advances, up 12 basis points quarter-on-quarter. Net NPA, too, was at 0.99% in Q4, up 2 bps quarter-on-quarter.

The company's cards in force grew 13% year-on-year to 1.89 crore. The spends also rose 11% year-on-year to Rs 9,653 crore, while receivables grew 25% to Rs 50,846 crore.

Abhijit Chakravorty, managing director and chief executive officer of SBI Card, said in a post-results analyst call that the new card acquisition was at 4.4 million during FY24.

"...we continue to be second-largest card issuer in country... Our CIF market share (was) at 18.6% during FY24." He added that the strong growth in spends have helped in growth of receivables.

SBI Card's market share for FY24 cards-in-force stood at 18.6% and in spends, it stood at 17.8%.

The lender's cost-to-income ratio for the quarter stood at 51.1%, down 881 basis points sequentially. Chakravorty said that it has improved due to lower corporate spend, among other reasons. He also guided for the ratio to be in the range of 58-60% for FY25.

According to the Q4 FY24 investor presentation, the retail spends stood at Rs 69,189 crore, up 25% year-on-year. Corporate spends declined both sequentially and yearly, with a 35% fall to Rs 10,464 crore year-on-year.

The company's gross credit cost for Q4 stood at 7.6%, up 7 bps quarter-on-quarter. "We expect credit costs to remain elevated in the future... The average credit costs for FY25 (are expected) to prevail at about 7%," Chakravorty said.