Q2 2025 SBI Cards and Payment Services Ltd Earnings Call Transcript
Key Points
- SBI Cards and Payment Services Ltd (BOM:543066) reported a strong 36% year-on-year growth in credit card transaction volume, indicating robust consumer spending.
- The company maintained its position as India's second-largest credit card player with a CIF market share of 18.5%.
- Retail spends per card increased to INR1.58 lakh, showing a significant rise from INR1.39 lakh in Q2 FY24.
- SBI Cards launched a strategic alliance with Singapore Airlines to introduce a co-branded credit card, targeting the super-premium segment.
- The liquidity position remains strong with a capital adequacy ratio of 22% and a liquidity coverage ratio of 108%, well above the statutory requirement.
- Profit after tax decreased to INR404 crore from INR603 crore in Q2 FY24, primarily due to higher credit costs and increased operational expenses.
- Gross NPS increased to 3.27% from 3.06% in Q1 FY25, reflecting rising delinquency levels in the credit card industry.
- Credit costs rose to 9% from 8.5% in the previous quarter, driven by customers' cash flow challenges and increased leverage.
- The cost to income ratio increased to 53.4%, indicating higher operational expenses.
- Fee income growth was negative year-on-year, impacted by external actions and tighter portfolio management.
Ladies and gentlemen, good day and welcome to the SBI Cards and Payment Services Limited Q2 FY25 earnings conference call. (Operator Instructions) Please note that this conference is being recorded. I now hand the conference over to Mr. Abhijit Chakravorty, MD and CEO. Thank you and over to you, sir.
Thank you, Sheetal. And good evening everyone. I welcome you all to the earnings call along with my senior management team at SBI Card. A recent report on credit card market projects that the number of credit cards in India will reach 200 million by FY28, '29, with a CAGR of 15%, further establishing credit cards as a significant payment instrument.
September 2024 data indicates that credit card transactions in India reached 0.39 billion in volume, showing a 36% year-on-year growth in transaction volume, and 17.8% in spends value. The demand for credit cards remains strong as consumer spending is growing at a healthy
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