State Bank of India (SBI) has outperformed benchmark index and banking sector index during the past one year (see relative performance chart). Since it has delivered strong results on operating as well as assets quality front in a challenging environment, analysts continue to increase their bets on this counter. Its net interest income (NII) and net profit reported y-o-y growths of 19% and 80% respectively during the fourth quarter of 2020-21. In addition to general fall in rates structure, increased contribution by current and savings accounts (Casa) also Helped Sbi Bring down its interest costs. Compared to its term deposit growth of 12% y-o-y, its current and savings accounts grew by 27% and 15% respectively.Its improvement on the asset quality front is starker. Its slippage during the fourth quarter was the lowest in 20 quarters and helped SBI bring down its net NPA further to 1.5% in March 2021, compared to 2.23% in March 2020. Its fresh slippages during 2020-21, which was 0.44% of retail loans and 1.18% of total loans, were also much lower compared to other large banks. After reporting sub-optimal earnings during the past several years due to high credit costs, SBI will now report normal earnings in the coming years and as per Analyst estimates, its EPS will grow by another 56% in 2021-22.Though there will be a small increase in NPA in the first half of 2021-22 due to the second wave of Covid, it will not be able to derail SBI’s overall asset quality improvements. The bank continues to report strong collection efficiency and the same stood at 95% in April and 96% in May. Since it already has 85% provision coverage on its corporate portfolio, it will be a major beneficiary of any corporate resolutions. Improvements in provision coverage ratio (PCR) to 87.75% in 2020-21 from 83.62% in 2019-20 and capital adequacy ratio (CAR) to 13.74% from 13.06% are other positive factors.With the largest branch network, retail franchise and high Casa ratio which improved further to 46.13% in 2020-21 from 45.16% in 2019-20, SBI is the best play on the gradual recovery of Indian economy. It is already the cheapest among large banks (see valuations table) and will become cheaper after the earnings normalisation. In addition to its core banking business, SBI is also a holding company with several fledging subsidiaries like SBI Cards, SBI Life Insurance, SBI Mutual Fund, etc.83457855Selection MethodologyWe pick up the stock that has shown the maximum increase in “consensus analyst rating” during the past one month. Consensus rating is arrived at by averaging all analyst recommendations after attributing weights to each of them (ie 5 for strong buy, 4 for buy, 3 for hold, 2 for sell and 1 for strong sell) and any improvement in consensus analyst rating indicates that the analysts are getting more bullish on the stock. To make sure that we pick only companies with decent analyst coverage, this search will be restricted to stocks with at least 10 analysts covering it.