ICICI Bank Q4 Results: Share prices of ICICI Bank rose nearly 2 percent after the company reported a 59 percent increase in standalone net profit for the March 2021-2022 quarter. The bank’s figures were well in line with analysts’ estimates, the outperformance against its competitors has helped them to become more optimistic on the numerator. In the past year, shares of ICICI Bank have risen 28 percent. Brokers remain optimistic about the stock and see a rise to 43 percent going forward due to the positive outlook for asset quality. The stock rose 1.89 percent to Rs 761.50 on the BSE. On the NSE, it rose 1.83 percent to Rs 761.35.
The private sector lender on Saturday reported a 59 percent increase in stand-alone net profit to Rs 7,019 crore for the fourth quarter of 2021-2022. The bank had made a profit of Rs 4,403 crore in the corresponding period from January to March of last year. The bank’s total income rose to Rs 27,412 crore in January-March from Rs 23,953 crore in the same quarter a year ago, ICICI Bank said in a regulatory filing.
Net interest income (NII) rose 21 percent to Rs 12,605 crore from Rs 10,431 crore in the same quarter a year ago, it said. The quality of the bank’s assets improved as gross non-performing assets fell to 3.60 percent of gross advances on March 31, 2022, from 4.96 percent in the same period a year ago.
What do brokers say?
The main growth drivers for ICICI Bank were excellent loan growth, credit card portfolio expansion and asset quality improvement. A greater focus on technology has also benefited the private lender, analysts say.
“The Q4FY22 gain reaffirms our belief that ICICI Bank is preparing for sustainable and prudent growth, led by technology-driven initiatives and credit cost normalization,” said Ajit Kumar Kabi, banking analyst at LKP Securities.
Axis Securities analysts said they continue to like the stock, given its strong liability franchise and taking advantage of opportunities in group products. “Based on expectations of moderating credit costs and healthy PPOP growth, we have revised our EPS estimates for FY23 upwards by 5 percent and left unchanged for FY24E. We maintain a BUY recommendation for the stock with a revised target price of Rs 1,000,” said Axis Securities.
Similarly, YES Securities analysts are revising the target price to Rs 1,043. They value the standalone bank at 3.1x FY23 P/BV for a FY23E/24E RoE profile of 15.8/16.6 percent and assign a value of Rs 174 per share to the subsidiaries, on SOTP.
Angel one Ltd. said the stock is trading at current levels at a P/BV of 2.1xFY24, adjusted for book value, after considering subsidiary valuations, which are below the historical average. After the Q4FY22 numbers, we continue to maintain our positive stance on ICICI Bank and it remains one of our top picks in the large-cap banking space.
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