State Bank Of India Net Income surged on 19.9% in 2015

22-05-2015 • About State Bank Of India ($SBIN) • By InTwits

State Bank Of India reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:

State Bank Of India has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.4%. At the same time it's in pair with industry average of 1.4%.
CAPEX is quite volatile: 633,640 in FY2015, 600,870 in FY2014, 307,260 in FY2013, 163,810 in FY2012, 338,650 in FY2011
The company has potentially unprofitable business model: ROIC is at 5.5%
It operates with high leverage: Net Debt/EBITDA is 3.9x while industry average is

Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

State Bank Of India ($SBIN) key annual financial indicators

mln. INR	2011	2012	2013	2014	2015	2015/2014
P&L
Revenue	1,468,596	1,760,138	2,015,100	2,260,683	2,579,526	14.1%
Net Income	106,849	153,431	179,162	141,738	169,943	19.9%
Balance Sheet
Cash	1,193,498	791,992	895,740	1,140,956	1,442,875	26.5%
Short Term Debt	517,372	513,454	619,556	235,484	440,087	86.9%
Long Term Debt	1,424,704	1,579,895	2,037,200	2,237,597	2,446,592	9.3%
Cash flow
Capex	18,742	23,398	35,714	31,785	34,523	8.6%
Ratios
Revenue growth	8.8%	19.9%	14.5%	12.2%	14.1%
Net Income Margin	7.3%	8.7%	8.9%	6.3%	6.6%	0.3%
CAPEX, % of revenue	1.3%	1.3%	1.8%	1.4%	1.3%	-0.1%
ROIC	7.0%	7.6%	6.7%	4.9%	5.5%	0.6%
ROE	12.8%	16.2%	15.5%	10.4%	11.0%	0.6%

Revenue and profitability

State Bank Of India's Revenue jumped on 14.1% in FY2015.

Net Income marign showed almost no change in FY2015.

Capital expenditures (CAPEX) and working capital investments

In FY2015 the company had CAPEX/Revenue of 1.3%. CAPEX/Revenue showed almost no change from FY2012 to FY2015. It's average CAPEX/Revenue for the last three years was 1.5%.

Return on investment

The company operates at low ROIC (5.53%) and ROE (11.01%). ROIC increased slightly on 0.63 pp from 4.9% to 5.5% in FY2015. ROE increased slightly on 0.60 pp from 10.4% to 11.0% in FY2015.

Leverage (Debt)

Debt jumped on 16.7% in FY2015 while cash surged on 26.5% in FY2015.

Appendix 1: Peers in Banks

Below we provide State Bank Of India benchmarking against other companies in Banks industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.

Top companies by Revenue growth, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Kotak Mahindra Bank ($KOTAKBANK)		18.4%	22.9%	7.1%	26.1%
Dcb Bank ($DCBBANK)		26.7%	26.2%	22.5%	25.3%
Syndicate Bank ($SYNDIBANK)		32.2%	11.9%	7.9%	20.2%
Yes Bank ($YESBANK)		53.0%	33.7%	21.6%	17.7%
Axis Bank ($AXISBANK)		39.0%	24.5%	13.1%	15.6%
Median (23 companies)	-36.9%	29.5%	16.2%	10.3%	9.9%
State Bank Of India ($SBIN)		19.9%	14.5%	12.2%	14.1%

Top companies by CAPEX/Revenue, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
State Bank Of Mysore ($MYSOREBANK)	1.3%	1.6%	1.3%		3.5%
Jammu & Kashmir Bank ($J&KBANK)	5.6%	1.4%	1.3%	2.2%	3.3%
Lakshmi Vilas Bank ($LAKSHVILAS)	4.4%	2.1%	1.4%	1.6%	2.4%
Dcb Bank ($DCBBANK)	1.6%	9.0%	7.0%	1.6%	1.9%
Karur Vysya Bank ($KARURVYSYA)	4.2%	2.0%	2.9%	2.5%	1.7%
Median (23 companies)	1.2%	1.2%	1.1%	1.2%	1.4%
State Bank Of India ($SBIN)	1.3%	1.3%	1.8%	1.4%	1.3%

Top companies by ROIC, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Karnataka Bank ($KTKBANK)	5.5%	6.8%	10.2%	7.7%	10.4%
Axis Bank ($AXISBANK)	10.2%	9.6%	8.9%	9.1%	8.8%
Yes Bank ($YESBANK)	11.8%	9.8%	8.4%	8.4%	8.7%
Kotak Mahindra Bank ($KOTAKBANK)	7.8%	6.8%	6.5%	7.1%	8.5%
Lakshmi Vilas Bank ($LAKSHVILAS)		6.5%	7.5%	0.7%	6.1%
Median (23 companies)	7.5%	6.8%	6.0%	3.2%	4.7%
State Bank Of India ($SBIN)	7.0%	7.6%	6.7%	4.9%	5.5%

State Bank Of India stock price chart

State Bank Of India financials

mln.	FY2010	FY2011	FY2012

Revenue	1,349,925	1,468,596	1,760,138
EBITDA	0.000	0.000	0.000
Net income	117,338	106,849	153,431
CAPEX	21,219	18,742	23,398
Debt	1,776,381	1,942,077	2,093,349
Cash	821,956	1,193,498	791,992

About State Bank Of India

State Bank of India provides various banking products and services in India and internationally. It offers personal banking products and services, including current accounts, savings accounts, term deposits, and capital gain schemes; housing, car, property, educational, personal, festival, career, scholar, and gold loans, as well as loans for pensioners and loans against shares/debentures; and mobile and Internet banking, demat, ATM, foreign inward remittance, safe deposit locker, public provident fund, multi-city cheques, money transfer, and mobile wallet services, as well as cards and inflation indexed national savings securities-cumulative bonds. The company also provides corporate banking services comprising corporate accounts, working capital and project finance, deferred payment guarantees, corporate term loans, structured finance, dealer and channel financing, equipment leasing, loan syndication, construction equipment loans, financing Indian firms overseas subsidiaries or JVs, and cash management products; products for NRIs, including accounts and deposits, loans, remittances, and investments; agricultural banking and micro credit to agriculturists and landless agricultural laborers; and current accounts, deposits, transaction banking, asset backed loans, fleet finance schemes, and collateral free loans for SME customers. In addition, it offers international banking products and services; broking, bill payment, and online railway ticket booking; and credit cards, life and general insurance, mutual funds, factoring, security trading, pension fund management, and custodial services, as well as primary dealership services in the money market. The company operates through 21,977 branches, including 6,108 branches of its 5 associate banks; and 51,491 ATMs. State Bank of India was founded in 1806 and is based in Mumbai, India.