SBI's Khara Reflects on Record Profits, Unfulfilled Valuation

Outgoing SBI Chairman Dinesh Kumar Khara highlighted the bank's record-breaking net profits during his four-year tenure but expressed dissatisfaction with its market valuation. With a profit jump from Rs 14,000 crore annually to Rs 17,000 crore quarterly, Khara believes the bank's true value isn't recognized, despite extensive resources and improved productivity.

Outgoing SBI chairman Dinesh Kumar Khara on Saturday remarked that the net profits of the country's largest lender have skyrocketed under his leadership in the past four years, outpacing the cumulative figures of the previous 64 years.

Khara expressed disappointment that despite SBI's vast network of over 22,000 branches and robust reserves, the bank is still undervalued in the market.

'In the last four years, we have earned a net profit of Rs 1.63 lakh crore, compared to Rs 1.45 lakh crore for the preceding 64 years,' said Khara during his final post-earnings press briefing.

Khara noted that the bank's annual profit has surged from Rs 14,000 crore to Rs 17,000 crore per quarter since he took office.

Under his leadership, productivity has also improved significantly, with profit per employee increasing nearly sixfold to Rs 30 lakh.

Khara remains optimistic about accelerating profit growth, targeting a 16% increase to reach Rs 1 lakh crore PAT in FY25, despite a modest 1% profit growth in the June quarter.

He assured that his successor would not jeopardize profits with higher provisions, as the balance sheet has been collaboratively prepared by all managing directors.

Despite these achievements, Khara lamented that the astonishing profit performance has not resonated with investors.

He expressed dissatisfaction with SBI's market capitalization, which has risen to Rs 1.92 lakh crore from Rs 0.84 lakh crore in five years.

'I am not happy with our valuation, especially when compared to other market players,' Khara stated.

He emphasized SBI's strengths, including its extensive branch network, strong brand recall, and significant liquidity buffers.

Khara also highlighted that the average savings account balance has grown to Rs 17 lakh crore from Rs 12 lakh crore in the past four years.

When asked if he had any regrets, Khara affirmed that he had none.

(With inputs from agencies.)