SBI Cards trades higher for fifth straight day; stock gains 3%

Shares of SBI Cards and Payment Services had been up 3 per cent at Rs 855 on the BSE on Friday, gaining 4 per cent previously two buying and selling days after the corporate stated it has launched bank cards in partnership with the digital cost platform Paytm.

The stock was buying and selling higher for the fifth straight days and up 7 per cent in the course of the week, as in comparison with 5 per cent rise within the S&P BSE Sensex.

Available in two variants, Paytm SBI Card and Paytm SBI Card SELECT, the product has been launched on the Visa platform. This launch is consistent with SBI Card’s endeavour to supply prospects tailor-made merchandise which deliver most worth consistent with spending wants and to encourage digital types of funds for a secure and enhanced buyer expertise, SBI Card stated in a launch.

“The credit card industry in India remains largely underpenetrated. Also, given the current scenario where social distancing is a way of life and cashless payments are a safer alternative, there has been a renewed impetus to digital payments from all corners,” stated Ashwini Kumar Tewari, MD & CEO, SBI Cards.

Prior to present week, the stock had corrected 13 per cent from its all-time excessive stage of Rs 919, touched on October 10, 2020, as buyers dumped the stock on fears of rising unhealthy loans.

However, SBI Cards has been steadily gaining market share with Cards share reaching 18.7 per cent and share of spends rising to twenty.5 per cent as of August 2020 (vs. 18.5 per cent and 19.9 per cent, respectively in Q1FY21). Analysts stay optimistic on the long run structural story and the spends inching towards pre-Covid ranges.

“We expect growth momentum to pick-up in retail credit activity and daily spends in the coming quarters as market recovers back to normalcy. SBI Cards’ solid foothold, healthy asset quality, brand image and increasing market share should continue to support the Company’s performance,” analysts at Geojit Financial Services stated in outcome replace.


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