Stock market analysts have suggested investors to ‘sell’ State Bank of India (SBI) stock with a target of Rs 1271.

According to them, interested investors can sell the stock between Rs 1295-1300 with a strict stop loss of Rs 1320.
 
Today (Jan 07), the stock opened at Rs 1330.90, against its last closure at Rs 1324.20 on the Bombay Stock Exchange (BSE) on Tuesday (Jan 06). Current EPS & P/E ratio stood at 119.59 and 10.76 respectively. The share price has seen a 52-week high of Rs 23.87.60 and a low of Rs 991.10 on BSE.

Analysts also suggested that if the stock fell below Rs 1260, it may see more weakness. So the investors must sell SBI stock in today’s session. After selling the stock, the interested investors can purchase the stock again at a low price, for medium or long term prospective to make good profits.

SBI, India’s largest bank, has acquired 19.70% equity stake in Mayfair Hotels and Resorts (MHRL) through a private equity (PE) transaction.

SBI has purchased 3,733,333 shares having a face value of Rs 10 each share. The shares acquired by SBI are from the fresh shares issued by the company. Accordingly, the company’s subscribed equity base has increased to 18,933,333 shares from 15,200,000 shares formerly. Post-deal, the promoters would hold 80 percent.

Moreover, the hotel chain has also decided to hit the capital market with an IPO in about 24 to 36 months after utilization of the proceeds of the 19.70% equity issued to SBI.

SBI, on Jan 03, announced that it plans to sell upper tier 2 bonds to retail investors.

The bank said that this was the first time in Indian banking history that a bank has decided to sell tier 2 bonds to individuals. As a rule, banking institutions sell tier 2 bonds to institutional investors (IIs) for raising capital to shore up their capital adequacy ratio (CAR).

The bank also announced that it has decided to open 60 branches in the North-Eastern (NE) region, mainly in the rural and semi-urban areas, to provide better service to its clients.

Presently, SBI has a network of 230 branches in Assam, and 478 in the entire North-East.

Moreover, SBI is also planning to infuse fresh capital into its insurance arm, SBI Life, which is looking for the right market conditions to lift funds via an IPO. 

Previously, SBI said that its insurance arm, in which it holds a majority 76% stake, would hit the capital market by the end of 2009.