SBI Card share: The year 2024 has been difficult for the shareholders of SBI Cards and Payment Services Limited. The company’s shares have fallen by about 10 percent in the last one year. At the same time, it has fallen by 32 percent in the last 5 years. The stock fell from its high of ₹1029.50 in March 2020 to ₹695.45 on December 24, 2024. The shares of the company fell by 0.59 percent today and closed at Rs 695.45 on BSE. The market cap of the company is Rs 66161.35 crore. Now the question is whether there will be a recovery in the company’s shares in the new year 2025?
Poor performance even in a growing industry
SBI Card shares declined 10% in 2024, underperforming the Nifty 50 index, which rose 13% during the same period. Its spending market share fell 20% year-on-year (YoY) in November 2024, while the broader industry grew 5%. Morgan Stanley reported that the company’s credit card market share is down 18.7% compared to previous months. Analysts have linked this decline to the new rules of the Reserve Bank of India (RBI), which affect corporate card spending.
In March 2024, the Reserve Bank of India (RBI) directed that companies will have to monitor the use of corporate credit and debit cards. This rule has affected SBI cards, because the business of the company mainly depends on corporate transactions. Morgan Stanley maintained equal-weight rating with a target price of ₹650. This means that there could be a potential decline of about 6%.
Concerns related to SBI Card’s profit
The company saw a decline in profit in the September 2024 quarter. Its PAT declined by 32.9 per cent to ₹404.42 crore, compared to ₹602.98 crore in the same quarter last year. Finance costs increased 30% to ₹788 crore due to higher borrowings. Loan losses rose 63% to ₹1,212 crore, impacting margins. Although operating expenses were cut by 3%, rising borrowing costs outweighed these savings.
SBI Card: Analysts’ opinion and target price
There is a difference of opinion among brokerages regarding the shares of SBI Cards and many people are adopting a cautious approach.
| Brokerage | rating | Target Price (₹) |
| goldman sachs | buy | 960 |
| Kotak | buy | 850 |
| Jefferies | hold | 760 |
| CLSA | hold | 750 |
| Macquarie | neutral | 750 |
| Elara Capital | Reduce | 719 |
| Emkay | Reduce | 700 |
| JPMorgan | under weight | 640 |
| Nomura | Reduce | 625 |
SBI Card’s 2025 Outlook
SBI Card’s number of new card issuances is expected to decline, and the share of high margin earning assets remains low. Asset quality concerns add to the challenges. Nomura has described FY25 as a potential “washout year”, citing slow card additions and limited growth in high-margin assets.
However, there are some positive signs also. Transaction volume increased by 30 percent in November 2024, although this was slightly lower than the industry’s 32% growth. Daily spending increased by 8% in December, but the pace of recovery seems to be slowing.
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