SBI Cards Q2 Results: Net profit drops 33% YoY to ₹404 crore as provisions surge

SBI Cards and Payment Services on Tuesday, October 29, reported a 33% year-on-year (YoY) decline in net profit to ₹404 crore for the second quarter of fiscal 2025 (Q2 FY25), due to an increase in provisions. In the same period last year, the company posted a PAT of ₹603 crore.

Provisions rose sharply to ₹53,596 crore, up from ₹49,079 crore as of March 31, 2024, reflecting growing stress in the unsecured loan segment, a trend seen across Indian lenders.

It reported a modest 8% YoY increase in total income to ₹4,556 crore compared to ₹4,221 crore in Q2 FY24. The company’s interest income rose by 20% to ₹2,290 crore in Q2 FY25, up from ₹1,902 crore in the same period last year.

However, fees and commission income saw a slight decline of 2% to ₹2,131 crore in Q2FY25 compared to ₹2,186 crore in Q2FY24.

Key profitability metrics also showed a decline, with Return on Average Assets (ROAA) at 2.7% for Q2 FY25 versus 4.9% in Q2 FY24 and Return on Average Equity (ROAE) at 12.5% compared to 22.3% in the prior-year quarter, according to the company’s Q2 earnings filing.

On the asset quality front, gross non-performing assets (NPAs) increased to 3.27% of gross advances, up from 2.43% a year earlier, while net NPAs rose to 1.19% from 0.89% over the same period.

Key operational metrics showed mixed performance. Cards-in-force grew by 10% YoY, reaching 1.96 crore as of Q2FY25 compared to 1.79 crore in Q2FY24. New account volumes, however, declined, with 9 lakh new accounts opened in Q2FY25 versus 14 lakhs in Q2FY24.

Spends increased marginally by 3% YoY, reaching ₹81,893 crore from ₹79,164 crore, and receivables saw a 23% YoY growth to ₹55,601 crore in Q2 FY25, up from ₹45,078 crore in Q2 FY24.

Market share for Q2 FY25 stood at 18.5% in cards-in-force, down from 19.2% in Q2 FY24, while the share of total spends declined to 15.7% from 18.0%. SBI Cards remains in the number 02 spot in cards-in-force and number 03 in total spends within the industry.

The company is a non-banking financial company that offers an extensive credit card portfolio to individual cardholders and corporate clients, which includes lifestyle, rewards, travel & fuel, and banking partnerships cards, along with corporate cards covering all major cardholders’ segments in terms of income profile and lifestyle.

Stock price trend

The company’s shares have declined by 11.19% so far this month. From a high of ₹932 per share in June 2023, the stock has fallen by 26.3% to its current level of ₹686.90. Compared to its all-time high of ₹1,164, the shares are now down by 41%.

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