Jefferies has issued a Buy Call on SBI Cards, setting a target of Rs 1,020. The management’s optimistic expectations for healthy growth in card spending have contributed to this favorable recommendation.
SBI Cards, a leading player in the credit card segment, has implemented tightened filters for new card sourcing, a strategic move that may also impact the revolver mix to some extent. However, Jefferies notes that the potential impact on yields could be offset, at least partially, by an anticipated increase in the EMI mix.
Notably, the management has addressed potential concerns related to broader stress in the credit card industry. While acknowledging that credit costs may remain elevated in the near term, SBI Cards is poised to navigate these challenges, according to Jefferies.
The development in the credit card sector, and Jefferies’ Buy Call on SBI Cards reflects confidence in the company’s resilience and adaptability amidst evolving market dynamics. As the company strategically adjusts its filters and operations, market watchers anticipate how SBI Cards will seize opportunities for growth in the dynamic credit card landscape.
It’s important to note that investment decisions should be made with careful consideration of individual financial goals and risk tolerance, and consulting with financial advisors is advisable for personalized investment strategies.