In the past four years, SBI has earned a net profit of ₹1.63 trillion, surpassing the cumulative profit of ₹1.45 trillion earned over the previous 64 years. State Bank of India’s chairman, Dinesh Kumar Khara, highlighted this achievement during the Q1 earnings press meet, emphasizing it as his proudest accomplishment.
“When I assumed office, the annual profit for the public sector lender was around ₹14,000 crore. This has now risen to a PAT of ₹17,000 crore per quarter,” Khara noted. He has been leading the bank since October 2020 and is set to step down at the end of his term later this month.
Khara shared his ambition for SBI to generate ₹1 trillion in profit after tax. “Last year (FY24), we were about ₹80,000 crore, and with the trajectory we are following this year (FY25), I believe it is likely to be a reality.”
The significant improvement in profitability is attributed to resolving operational issues in lending, boosting other income, and enhancing employee productivity. SBI’s per employee business has grown from ₹24 crore to about ₹38 crore in the past four years, while profit per employee has grown nearly six times to around ₹30 lakh.
Despite these achievements, Khara believes the bank is undervalued by the market. He expressed dissatisfaction with the current valuation, stating, “I am not happy; how can I be happy? We are not getting our right value, it should be higher. Look at the other players.”
When asked which peer he would like SBI to be benchmarked against, Khara asserted that SBI is a benchmark in itself due to its network of over 22,000 branches, strong brand presence, substantial balance sheet, comfortable liquidity buffers, and future growth potential.
Khara also noted that the average balance in SBI’s savings accounts is three times higher than that of its nearest competitor, having increased from ₹12 trillion in March 2020 to around ₹17 trillion in June.
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