22 May 2018 4QFY18 Results Update | Sector: Financials SBIN reported a loss of INR77.2b, with slippages spiking up to INR336.7b (INR174.35b from known stressed book), even as total revenue exceeded our estimate by 9%. aided by a sharp sequential pick-up in the large- and mid-corporate portfolio, while retail advances growth stood at a healthy 14% YoY (+5% QoQ). Erstwhile SDR and S4A accounts contributed INR56.62b to slippages Total watch-list (including previous standard stressed assets as well as SMA 2 and stressed SMA1 accounts) stood at INR258b. The bank is hopeful of better asset quality trend in ensuing years (increase in resolution of stressed accounts and lowering of the watch-list). Overall, we expect standalone banks PPoP CAGR of 17% over FY18-20E, but PAT growth will be higher as credit costs decrease; RoA is expected to improve to 0.4%/0.7% by FY19/FY20e .SBIN is highly levered to macroeconomic conditions, and an improvement in the investment climate would assuage asset quality fears.