State Bank of India

Peer numbers are shown only where the peer is in the security master (fundamentals pulled); "n/a" otherwise — a peer is not added to the data pull without a research request. Reasons are quoted from the one-pager (8 Sep 2026).

Kotak Mahindra Bank is the obvious omission. Our model rates it REDUCE: a 12% ROE bank at 2.0x core book, priced for a 17% ROE it does not earn, with CASA sliding toward 40% and a CEO succession still ahead. The argument the house has used for years — a 16–17% ROE bank cannot compound above that without dilution, so 4–5x book is unsustainable — applies with more force to a 12% one. IndusInd is a governance rebuild we do not need to underwrite; Federal Bank and AU Small Finance are good franchises but neither has IDFC First's deposit engine or its operating-leverage runway at a comparable price. Among public-sector banks, Bank of Baroda and Canara are cheaper on paper but have weaker CASA, thinner capital and none of SBI's subsidiary optionality; SBI's premium (1.25x vs 0.9–1.0x) is the price of a franchise that survived the AQR and emerged with the best retail book in the system.

ICICI Bank (7.0%, Core) is the anchor: the highest-quality large bank in India (ROA 2.2%, ROE 16%+, best-in-class liability franchise and technology) — we own it for the certainty of its compounding, not for a re-rating. Axis Bank (6.0%, Core) is the bank where the numbers are still improving: ROE goes from 12.7% to 15.6% on our model as NIM recovers off the June-quarter trough and operating leverage kicks in; it trades at 1.7x core book against a 1.7x fair value with an 18% expected return. SBI (4.0%, Core) is the cheapest large bank in India (1.25x core book) with a 15–16% ROE, a 39% CASA franchise no private bank can match, ₹3 lakh crore of excess SLR to fund 15% loan growth and ₹240 per share of listed subsidiaries today (₹270 by Sep-27). HDFC Bank (1.8%, Core) is a small, new position: the house avoided it at 4–5x book and was right; at 1.6x core book with a 16% normalised ROE the argument has reversed and it is now the highest-expected-return name in our model — we would build it ahead of the CEO succession decision. IDFC First (2.3%, Turnaround) is the satellite: a retail liability franchise (CASA 51%) built ahead of profitability, where the ROE goes from 4% to 8% to low-teens as the microfinance cycle normalises and the cost-to-income ratio falls.