On this page ▾
Today's prices ask more of Punjab National Bank than of State Bank of India.
At current prices, buyers of Punjab National Bank are assuming about 13.4% return on equity against 11.5% in its own record; for State Bank of India it is 14.8% against 16.1%. That shows which share needs more to go right — not which is cheaper. How far each trades from its estimated fair value is in the full valuations.
- Valuation method: both on excess return.
- Size: State Bank of India is worth about 6.1 times Punjab National Bank on the stock market.
- Record: Punjab National Bank has grown revenue faster: Punjab National Bank compounded at about 14% a year (FY2019–FY2026) and State Bank of India at about 12% (FY2019–FY2026).
- What to watch: credit costs at Punjab National Bank; return on equity versus its own history at State Bank of India.
| Punjab National Bank | State Bank of India | |
|---|---|---|
| Price | ₹143 | ₹1,080 |
| Market cap | ₹1.64L Cr | ₹9.97L Cr |
| P/E | 7.2 | 11.0 |
| P/B | 1.09 | 1.62 |
| Fair value 🔒 sign in | ₹0,000 | ₹0,000 |
| Upside 🔒 sign in | +00% | +00% |
| Valued on | Excess return | Excess return |
01Two businesses
A century-old bank, rebuilt
Punjab National Bank, founded in Lahore in 1894, is one of India's largest public-sector banks and is majority-owned by the Government of India. In 2020 it absorbed Oriental Bank of Commerce and United Bank of India.
The bank the whole country runs on
State Bank of India is the country's largest bank by deposits, loans, branches and customers, and it is majority-owned by the Government of India. It lends to everyone from farmers and home buyers to the largest corporates, and its group includes SBI Life, SBI Card, the SBI Mutual Fund asset manager and SBI General Insurance.
02The records side by side
Punjab National Bank has grown revenue faster: Punjab National Bank compounded at about 14% a year (FY2019–FY2026) and State Bank of India at about 12% (FY2019–FY2026). By revenue, State Bank of India is about 4.7 times the size of Punjab National Bank. Punjab National Bank kept 11.4% of revenue as net profit in FY2026; State Bank of India kept 12.0% of revenue as net profit in FY2026. Punjab National Bank reported a net loss in FY2019; State Bank of India was profitable in every year shown.
Full ten-year tables and charts are on each company's page: Punjab National Bank · State Bank of India.
03What each price assumes
Work backwards from each share price and you can see what buyers are taking for granted — the rate each company must sustain to justify what it costs, against what its own record supports.
04What decides each one's value
- Credit costsLower provisions have driven the profit recovery.
- Return on equityWhether returns hold through the next credit cycle.
- Return on equity versus its own historySBI's value depends on whether recent returns hold through a full credit cycle — something it has not shown before.
- Credit costsBecause the book is so large, even a modest rise in fresh bad loans would show up quickly in profit.
05What could go wrong
- Asset qualityA new wave of bad loans would reverse the gains.
- ControlsThe 2018 fraud showed the cost of weak controls.
- A turn in corporate creditSBI's history shows how fast large-company defaults can erase years of profit.
- Staff and pension costsWage settlements at a public-sector bank are less flexible and can lift costs in step.
06Which is better value?
Sign in free to see which trades further below its worth
- ✓Both fair values per share — each on the method that fits the business
- ✓Every step of both workings — growth, margins and cost of capital, with sources
- ✓Bull, base and bear cases — for each company
- ✓Downloadable reports — the full write-up for each, yours to keep
08Questions people ask
Is Punjab National Bank or State Bank of India better value?
That turns on how far each share trades from its estimated fair value. Both figures, with every step of the working, are in the full valuations, free to view once you sign in. On the public numbers, Punjab National Bank trades at 7.2 times earnings and 1.09 times book value, and State Bank of India at 11.0 times earnings and 1.62 times book value — but multiples alone mislead when two businesses work differently, which is why each is valued on the method that fits it.
What is the difference between Punjab National Bank and State Bank of India?
Punjab National Bank, founded in Lahore in 1894, is one of India's largest public-sector banks and is majority-owned by the Government of India. State Bank of India is the country's largest bank by deposits, loans, branches and customers, and it is majority-owned by the Government of India.
Are Punjab National Bank and State Bank of India valued the same way?
Yes — both on excess return, so their workings compare like for like.
What does today's price assume for Punjab National Bank and State Bank of India?
Worked backwards from the share price, Punjab National Bank needs about 13.4% return on equity and State Bank of India about 14.8% return on equity, against 11.5% and 16.1% in their own records.