SBI Cards & Payment Services stock rises after four days, here's why

Shares of SBI Cards & Payment Services rose in early trade today after global brokerage Morgan Stanley maintained a buy call on the stock with a target price of Rs 1,225. The new target price amounts to an upside of over 67 per cent from its previous close of Rs 731 on March 7. The brokerage has maintained an overweight stance on the large cap stock.

SBI Cards stock has gained after four days of consecutive fall. The stock gained 2.85 per cent intraday to Rs 747.5 against the previous close of Rs 730.45 on BSE.

SBI Cards share is trading lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The share has lost 29.83 per cent in one year and fallen 19.36 per cent since the beginning of this year.

Total 0.35 lakh shares of the firm changed hands amounting to a turnover of Rs 2.58 crore on BSE. Market cap of the firm rose to Rs 70,221 crore on BSE.

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Morgan Stanley said industry spending, which climbed 35 per cent year-on-year (YoY), declined 6.5 per cent on a month-on-month basis amid the impact of the third Covid wave.

However, SBI Cards posted a lesser fall of 5.7 per cent month-on-month and a rise of 45 per cent YoY in its spending. It also gained market share which is a positive sign for the arm of SBI .

The firm reported a 84 per cent rise in net profit at Rs 386 crore for the quarter ended December 31,  2021 against a net profit of Rs 210 crore in the year-ago period.

Revenue from operations rose 19.98 per cent to Rs 2,889 crore against Rs 2,408 crore year ago. Total income increased 24 per cent YoY to Rs 3,140 crore.

Income rose primarily due to higher income from fees and services during the quarter, SBI Cards said. Asset quality of the firm improved as gross non-performing assets (NPAs) fell to 2.40 per cent of gross credit as against 4.51 per cent as of third quarter of 2020-21.

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