ICICI Bank Shares: ICICI Bank gained at open on Monday after the bank reported its June quarter earnings. The private sector bank reported a 50 per cent in net profit to Rs 6,905 crore in the first quarter of the current fiscal, up from Rs 4,616 crore profit reported in the same quarter a year ago. ICICI Bank’s total income improved to Rs 28,336.74 crore in the quarter under review, up from Rs 24,379.27 crore in FY22.
Net interest income increased 20.8 per cent to Rs 13,210 crore with 21 per cent growth in advances and a 13 per cent increase in deposits. Net interest margin at 4.01 per cent improved from 3.89 per cent in the year-ago quarter and four per cent in March 2022 quarter.
The loan book increased 21 per cent to Rs 8.95 lakh crore as of June with domestic part growing 22 per cent and retail loan portfolio, 53 per cent of the total book, rising 24 per cent.
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According to domestic brokerage firm Motilal Oswal, ICICI Bank is seeing a strong recovery in business trends across key segments such as Retail, SME, and Business Banking. Asset quality trends remain steady, while PCR remains one of the best in the industry 80 per cent. The additional COVID19 provision buffer (90bp of loans) renders further comfort.
“Ahead of this new growth cycle, the bank is already positioned well with superior margins, strong RoE/asset quality and robust capitalisation levels. The stock return will be a function of earnings growth and re-rating over the coming years and ICICI Bank has all the ingredients in place to take over the pole position in the Indian Banking space,” it said. The brokerage maintains ‘Buy’ rating on ICICI shares with an SoTP-based target price of Rs 1,050 per share. ICICI Bank remains Motilal Oswal’s top pick in the sector.
According to analysts at Edelweiss Securities, ICICI Bank delivered a solid quarter, seventh in a row, outperforming consensus PAT by 17 per cent and beating peers HDFC Bank and Kotak on loan growth, NII growth, treasury and GNPLs. Lender’s Opex also exceeded expectations due to employee pay-outs and branch additions. The lender posted a trading gain of Rs 360mn versus a loss by peers. While GNPLs declined on quarter. The brokerage increased the target multiple to 3x (from 2.5x) Sep23E, backed by ICICI’s consistent delivery. The brokerage maintains ‘Buy’ call on the stock with a revised target price of Rs 1,020, up from Rs 950 earlier.
CLSA has a buy call on ICICI Bank with a target of Rs 1,040 per share. The global research firm is of the view that the bank delivered impeccable results.
Jefferies also has a buy call on ICICI Bank with a target of Rs 1,080 per share. “The bank continues to lead the sector on core performance. Valuations are attractive, even in global context,” it added.
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