India’s largest lender, State Bank of India (SBI), has said that its corporate loan book has no stress and it is ready to grow that segment further in the current financial year with a pipeline of Rs 3.5 lakh crore.

SBI chairman Dinesh Khara said private capex spending has started flowing in and the bank is expecting 70% of the Rs 3.5 lakh crore  corporate loan book would be term loans. Out of this pipeline, Rs 1.6 lakh crore is already sanctioned but disbursement is pending.

New projects are coming into greenfield sectors like renewable energy, batteries and electric vehicles, Khara said. In the core sectors like steel, cement, road infrastructure and airports, capacities are being added.

“In our lending book, we do not see any stress in large and mid-corporates,” Khara said.

In the corporate sector, growth is coming from manufacturing, roadways, aviation, construction and renewable energy, Khara said, adding that “it is broad-based”.

SBI posted a 28% year-on-year growth in lending to aviation. The bank is choosy in lending to airlines, Khara said. 

Corporate sector lending grew 12.38% to Rs 9.82 lakh crore in the fiscal first quarter ended June 2023, from Rs 8.74 lakh crore a year ago. 

SBI reported a 178% jump in net profit to Rs 16,884 for the quarter ended June 2023 compared to Rs 6,068 crore a year ago.

The bank is targeting a credit growth of 14-15% in FY24. "Our credit growth will be broad-based in retail, agriculture, small and medium-sized enterprises and the corporate sector,” Khara said. 

The bank reported a 13.90% rise in its loan book during the fiscal first quarter ended June 2023, with domestic advances growing at 15.08%.