ICICI Bank’s share price climbed 1.30% to Rs 944.80 a day after the bank reported a surge of 35.8% in its net profit for the second quarter of FY24, helped by robust loan growth and strong core lending income. The standalone profit for the quarter reached Rs 10,261 crore, a significant rise from the prior year’s Rs 7,557.84 crore, according to the regulatory filings.
The share price of ICICI Bank fell 1.75% in the last five days and 1.69% in the last one month, while it gained nearly 4% in the last six months and 4.16% year to date.
JM Financial Institutional Securities: Buy – Target Price: 1,155
“Going forward, management expects cost of deposits to continue to increase over the next couple of quarters (at 4.53% for 2Q24, +22bps QoQ, 98bps YoY) as deposit repricing plays out. In our view, this could lead to margin compression even further from current levels although, we expect NII growth of 17% for FY24 (implying largely stable NIMs for FY24 vs FY23). Asset quality continues to be in fine fettle with credit costs at 23bps and GNPA/NNPA at 2.63%/0.45% (vs 2.94%/0.51% QoQ). We expect ICICI Bank to deliver avg. RoA/ RoE of 2.2%/ 17.9% over FY24-FY25E and value the bank on SoTP basis with a target price of Rs 1,155 (core bank valued at 2.7x FY25E BVPS).”
HDFC Securities: Buy – Target Price: 1,190
“ICICI Bank clocked another steady quarter on the back of consistent loan growth (+18% YoY) and lower credit costs (23bps of loans), maintaining its robust asset quality alongside a healthy PCR (83%). Loan growth was driven by healthy deposit growth (+19% YoY), largely retail TDs as the CASA ratio eased to 40.8% (-222bps QoQ), resulting in a 22-bps QoQ spike in the cost of deposits. With limited yield reflation despite improving retail mix, NIMs softened by 25bps QoQ to 4.53% and are likely to trend further lower. We tweak our FY24E/FY25E forecasts to factor in the elevated cost of funds and opex intensity, largely offset by normalised credit costs (>40bps for each of FY24-25); we maintain ‘Buy’ with a SOTP-based Target Price of Rs 1,190 (standalone at 2.9x Mar-25 ABVPS).”
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