Between July 1, 2022, and June 30, 2025, the BSE PSU Index surged by an impressive 153%. This strong rally was driven by a combination of robust liquidity, attractive valuations, and the solid performance of key public sector companies. Among these, the State Bank of India (SBI) stood out as a major contributor to this growth, playing a pivotal role in boosting investor confidence in PSU stocks.
One of the most remarkable aspects of SBI’s growth story is how it managed to double its size from ₹30 lakh crore in 2018 to ₹60 lakh crore in 2024. What makes this even more unique is that the bank did this without doubling its number of branches or increasing its headcount. So, how did this happen?
Well, SBI leveraged digital technologies and operational efficiencies to achieve this scale, demonstrating a shift from traditional growth methods to a more tech-driven approach.
SBI’s adoption of new-age technologies, especially Artificial Intelligence (AI), has been central to its success. The bank introduced AI-powered predictive models that helped streamline processes, reduce risks, and improve customer service. This technology-driven efficiency allowed SBI to scale up its operations and financials without the typical costs associated with physical expansion.
The 2017 merger of SBI with five associate banks also strengthened its balance sheet and operational capabilities. This consolidation tightened lending processes and improved risk management. With stricter mechanisms for loan collections and non-performing asset (NPA) recognition, SBI enhanced its asset quality, contributing to a healthier financial profile that appealed to investors.
SBI’s financial results underline its growth impact on the PSU sector. In FY25, the bank’s Net Interest Income (NII) grew by 5.9% to ₹1,89,994 crore, while profit after tax surged 16% to ₹79,017 crore compared to the previous year.
Its market valuation also rose significantly by 18.7% year-on-year, reaching ₹7,11,435 crore in July 2025. This strong performance helped lift the entire BSE PSU Index.
SBI’s success is not just about numbers; it signals a broader transformation in the PSU space. The bank’s ability to leverage digital tools and efficient management practices has set a benchmark for other PSUs. This digital-first growth model, combined with strategic mergers and improved risk controls, has helped restore investor faith in public sector companies, fueling the BSE PSU Index’s spectacular rise.
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SBI’s growth journey from 2018 to 2024 has been a key driver behind the 153% surge in the BSE PSU Index between 2022 and 2025. By doubling its size through digital innovation and operational efficiency, rather than traditional branch expansion, SBI has demonstrated the new face of Indian public sector banks.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Published on: Sep 17, 2025, 4:48 PM IST
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