Stock analysts have maintained ‘buy’ rating on State Bank of India (SBI) stock with an intraday target of Rs 1333.

According to them, interested traders can purchase the stock around Rs 1315 with a strict stop loss of Rs 1295. If the stock market remains on positive track, the stock pricing becomes more attractive, and reach above Rs 1350.
 
Shares of the bank, on Thursday (Jan 01), closed at Rs 1315.80 on the Bombay Stock Exchange (BSE). The total volume of shares traded at the BSE was 793172. Current EPS & P/E ratio stood at 119.59 and 11.22 respectively. The share price has seen a 52-week high of Rs 2387.60 and a low of Rs 1315.80 on BSE.

The stock has great potential and it can still exhibit superb surge. It performed well on Thursday (Jan 01) and gained Rs 27.55 as against its previous closure at 1288.25 on Wednesday (Dec 31, 2008).

State Bank of India (SBI) is planning to infuse fresh capital into its insurance division, SBI Life, which is waiting for the accurate market conditions to raise capital through an IPO.  

Previously, the bank announced that SBI Life Insurance, in which it (SBI) holds a majority stake of 76%, would hit the capital market by the end of 2009.

BNP Paribas Assurance holds the remaining 24% stake in the life insurance firm.

Recently, the administration has tabled the Insurance Bill in Parliament intending to increase the FDI cap in the segment to 49% from 26% now.  

During December 2008, SBI declared that it plans to raise capital up to Rs 15 billion through 10 year lower tier-II to support capital adequacy ratio and expand business.

On Dec 22, SBI has revised the benchmark prime lending rate (PLR) by 75 bps from 13.00% p.a. to 12.25% p.a. effective from Jan. 01, 2009 and the deposit rates downwards by 25 bps to 100 bps across the various maturities effective from Jan. 01, 2009.

Moreover, the bank also announced that it is planning to raise unsecured and rated rupee innovative perpetual debt instruments/ upper tier II/ lower tier II subordinated debt by way of bonds and/ or any other capital instruments that RBI may authorize from time to time, not exceeding Rs 180 billion during the remaining part of FY: 2008-09 and FY: 2009-10, in tranches with a minimum maturity of over 60 months as per RBI guidelines, through structured deals or by private placement / retail participation.

Other stocks from the same sector that looks good for short-term as well as long-term trading includes Union Bank, PNB and Bank of India.