SBI vs Axis Bank Which Is More Attractive?

SBI and Axis Bank are two major players in the Indian banking sector, both of which have a significant presence in the market. SBI, the largest public sector bank in India, has a long-standing reputation and a vast network of branches across the country. On the other hand, Axis Bank, a private sector bank, has been making waves in the industry with its innovative products and services. Investors often compare the financial performance and growth potential of these two banks to make informed decisions about their investments.

SBI or Axis Bank?

When comparing SBI and Axis Bank, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between SBI and Axis Bank.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. SBI has a dividend yield of 4.16%, while Axis Bank has a dividend yield of 0.0%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. SBI reports a 5-year dividend growth of -44.26% year and a payout ratio of 56.44%. On the other hand, Axis Bank reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with SBI P/E ratio at 14.09 and Axis Bank's P/E ratio at 12.75. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. SBI P/B ratio is 0.94 while Axis Bank's P/B ratio is 2.06.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, SBI has seen a 5-year revenue growth of 1.88%, while Axis Bank's is -0.69%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with SBI's ROE at 7.09% and Axis Bank's ROE at 17.36%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $25.72 for SBI and $67.60 for Axis Bank. Over the past year, SBI's prices ranged from $19.00 to $27.02, with a yearly change of 42.21%. Axis Bank's prices fluctuated between $56.40 and $80.00, with a yearly change of 41.84%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.