SBI Cards net profit rises 20% in Q1FY27 as credit costs drop
SBI Cards and Payment Services Limited posted a net profit of ₹664.44 Crores in Q1FY27, up 20% YoY, aided by a drop in gross credit costs to 6.5% and a 10% rise in fee income. Total income reached ₹5,205.36 Crores. GNPA fell to 2.04% from 2.41%, and CAR remained strong at 25.64%.
*this image is generated using AI for illustrative purposes only.
SBI Cards and Payment Services Limited reported a 20% year-on-year increase in net profit after tax (PAT) to ₹664.44 Crores for the quarter ended June 30, 2026, driven by improved asset quality and a significant decline in gross credit costs. The company’s total income rose 3.4% YoY to ₹5,205.36 Crores, supported by robust fee and commission income which grew 9.8% YoY to ₹2,405.54 Crores. This financial performance coincided with the sourcing of over 1 million new accounts, expanding the cards-in-force portfolio to 2.26 Crore.
The Board of Directors approved the unaudited financial results on July 24, 2026, in compliance with Regulation 33 and Regulation 52 read with Regulation 63(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were subjected to a limited review by joint statutory auditors M/s V.K. Dhingra & Co. and M/s S.P. Chopra & Co. The company also disclosed an additional impairment provision of ₹70 Crores carried over and above the approved Expected Credit Loss (ECL) model due to continuing uncertain geo-political situations, alongside a ₹27 Crore provision for employee benefits arising from the New Labour Codes.
Portfolio Growth and Operational Metrics
SBI Cards demonstrated strong top-line momentum with retail spends growing 27% YoY. The total receivables book expanded to ₹58,269 Crores, marking a 3% YoY growth. Notably, Individual Borrower Non-Performing Exposure (IBNEA) accounted for approximately 55% of overall receivables. Spend per card for retail plus corporate segments reached ₹212,000, indicating healthy utilization rates. The 30-day retail spend active rate remained steady at 53%. Online spend penetration continued to deepen, with UPI spends on RuPay cards growing over 13% quarter-on-quarter.
| Metric | Q1FY27 (₹ Cr) | Q4FY26 (₹ Cr) | Q1FY26 (₹ Cr) |
|---|---|---|---|
| Total Income | 5,205.36 | 5,187.04 | 5,035.39 |
| Net Profit | 664.44 | 609.30 | 555.96 |
| Fee & Commission Income | 2,405.54 | 2,342.98 | 2,191.15 |
| Interest Income | 2,420.63 | 2,381.76 | 2,493.15 |
Asset Quality and Capital Adequacy
Asset quality metrics showed consistent sequential improvement. The Gross Non-Performing Asset (GNPA) ratio declined to 2.04% from 2.41% in the preceding quarter, while the Net NPA ratio fell to 0.83% from 1.04%. The provision coverage ratio improved to 59.88%. The company maintained a robust capital adequacy ratio (CAR) of 25.64%, well above regulatory requirements. Gross credit cost declined sharply to 6.5% from 7.7% in the previous quarter and 7.7% in the corresponding period of FY26. Consequently, earnings before credit cost (EBCC) stood at ₹1,841 Crores.
What the Numbers Show
The divergence between rising operating costs and declining credit costs highlights a strategic shift towards sustainable profitability through risk mitigation rather than aggressive volume expansion alone. The 301 basis point year-on-year reduction in gross credit cost significantly boosted bottom-line resilience, offsetting the pressure from higher operating expenses linked to business development incentives and employee benefits. The stability in interest income alongside surging fee income suggests a successful diversification of revenue streams, reducing dependency on interest margins. Furthermore, the controlled growth in receivables (3% YoY) relative to spend growth (27% YoY) indicates prudent underwriting standards that prioritize quality over sheer scale.
Historical Stock Returns for SBI Cards
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -0.53% | -4.01% | +1.90% | -19.70% | -30.91% | -35.34% |
How will the additional ₹70 Crore impairment provision for geo-political risks impact SBI Cards' projected credit cost trajectory in the upcoming quarters?
Given the 27% YoY growth in retail spends versus only 3% growth in the receivables book, what specific underwriting criteria changes are driving this improved asset quality?
To what extent will the implementation of the New Labour Codes and associated ₹27 Crore provision affect long-term operating expense ratios and profit margins?
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