The State Bank of India (SBI) has made headlines with a significant announcement that’s sure to excite its investors. On May 3, the public sector giant revealed a remarkable dividend of Rs 15.90 per share, marking an incredible 1,590% payout on its Rs 1 face value stocks. This represents the bank’s largest dividend distribution in over a decade. In addition to this generous payout, SBI is set to bolster its future growth by planning to raise Rs 25,000 crore in FY26.

SBI’s Record Dividend: A Welcome Surprise for Investors

SBI’s announcement of a final dividend of Rs 15.90 for the financial year ending March 2025 has brought smiles to the faces of shareholders. The record date for this dividend is set for May 16, with payouts expected to be credited to accounts by May 30. This payout is a notable leap from the last substantial dividend of Rs 41.50 declared back in 2013.

Earnings Report: A Mixed Bag for Q4

While the dividend news is impressive, SBI’s earnings report for January-March 2025 presents a more nuanced picture. The bank’s net profit saw a decline of nearly 10% year-on-year, totaling Rs 18,643 crore, largely due to a massive 300% increase in provisions for bad loans, amounting to Rs 6,442 crore. Nevertheless, there are positive aspects to consider: the bank’s operating profit rose by 8.83% to Rs 31,286 crore, and its Net Interest Income (NII) increased by 2.69% to Rs 42,775 crore.

Strong Annual Performance: Crossing the Rs 1 Lakh Crore Mark

Despite the challenges in Q4, the overall performance of SBI for FY25 was robust. The bank achieved an operating profit exceeding Rs 1 lakh crore for the first time, reaching Rs 1,10,579 crore, which is an impressive 17.89% increase from the prior year. The net profit for the entire financial year stood at Rs 70,901 crore, while the Gross Non-Performing Assets (NPA) decreased by 8.78% YoY, landing at Rs 76,880 crore. This led to an improved Gross NPA ratio of 1.82%.

Future Growth Plans: Capital Raise of Up to Rs 25,000 Crore

Looking forward, SBI’s board has authorized a significant capital raising plan of up to Rs 25,000 crore for FY26, with options such as Qualified Institutional Placement (QIP) or Follow-on Public Offer (FPO) being considered.

SBI Stock Performance: A Snapshot

In the latest trading session, SBI’s share price fell by 1.4%, landing at Rs 788.95. Over the past week, the stock has experienced a 4% decline. However, when viewed over a six-month horizon, there has been a 5% increase. In a year-long perspective, the stock has dropped by 2%, and it has seen a slight decrease of 0.5% year-to-date. Currently, SBI holds a market capitalization of Rs 7.03 lakh crore, with a 52-week high of Rs 912 and a 52-week low of Rs 680 per share.

With these developments, SBI is positioning itself for robust growth while rewarding its investors, making it a notable player in the banking sector. For further insights on investment opportunities, check out our related articles on market trends and stock performance.