hit new lifetime high of ₹471.90 apiece in early morning trade session. Extending its yesterday’s rally, SBI shares opened with an upside gap of ₹4.30 per equity share and went on to hit new lifetime high. consistent with stock exchange experts, this rally in SBI stocks is especially thanks to the yesterday’s Union Cabinet’s clearance to the proposal of ₹30,600 crore government guarantee for security receipts issued by the National Asset Reconstruction Company (NARCL) as a part of resolution of bad loans. They said that SBI are going to be the main beneficiary of this move and in next three months, this PSU banking stock may go up to ₹500 per stock levels.
Speaking on the rationale for SBI share price rally; Avinash Gorakshkar, Head of Research at Profitmart securities said, “Financials of SBI is already strong and after the announcement of state of India’s (GoI’s) guarantee for security receipts issued by NARCL, SBI goes to emerge major beneficiary of this GoI move. This rally should be seen within the wake of this bad bank announcement made by the GoI yesterday and it’ll have long-term impact on the bank. Positional buyers can purchase SBI shares for long-term once there’s a dip during this counter.”
Santosh Meena, Head of Research at Swastika Investmart Ltd said, “SBI hits its fresh all-time high along side Bank Nifty after recent developments of relief package for telecom and bad bank announcement. the general outlook is extremely bullish for SBI because it is that the strongest bank within the PSU space whereas it’s better fundamentals compared to most of the private banks. it’s trading at 1.5 P/B, which is extremely attractive as compared to big private banks like HDFC and Kotak Mahindra Bank. Investors are advised to stay with SBI within the PSU basket to make good wealth because the outlook is looking very bullish for this bank on the bank of serious improvement in asset quality, strong NII growth, and value unlocking through its subsidiaries.”
Echoing with Avinash Gorakshkar’s views; Rohit Singre, Senior Technical Analyst at LKP Securities said, “SBI shares have given an enormous breakout at ₹440 on closing basis and therefore the stock looks extremely bullish on chart pattern. those that have SBI stock in their portfolio are advised to further hold the counter maintaining stop loss at ₹440. However, if someone wants to shop for this PSU banking stock, my advice is to attend as profit-booking is strongly awaited during this counter. One can purchase this stock at around ₹460 and keep it up accumulating till it’s above ₹440. The stock may go up to ₹500 in next three month. However, one must maintain strict stop loss at ₹440 while taking this position in SBI stocks.”
Speaking on SBI share price targets; Santosh Meena of Swastika Investmart said, “Technically, SBI share has begin of 10 years of consolidation which will cause an enormous move during this counter in coming years because an equivalent pattern was formed in 2003 then stock moved 10 times within the next 5 years. However, on an instantaneous basis ₹475 to ₹500 area could act as an instantaneous supply zone but any correction within the counter should be seen as an honest buying opportunity.”