ICICI Bank share rises 6% post Q4 earnings, here's what brokerages say

ICICI Bank share rose over 6% today after the lender reported more than three-fold jump in its standalone net profit for the January-March quarter. Share of ICICI Bank gained 6.11% to hit intraday high of Rs 604.9. The stock opened with a gain of 5.31% at Rs 602 today.

The large cap stock trades higher than 5 day, 20 day, 100 day and 200 day moving averages but lower than 50 day moving averages.

The share rose 79.44% in one year and has gained 12.35% since the beginning of this year. Market cap of the firm climbed to Rs 4.16 lakh crore on BSE today.

ICICI Bank on Saturday reported a standalone net profit of Rs 4,403 crore in Q4 against net profit of Rs 1,221 crore in the year ago quarter.

Total income rose to Rs 23,953 crore in Q4 from Rs 23,443 crore in the year-ago quarter.  

On a consolidated basis, the net profit of the private sector lender jumped to Rs 4,886 crore in the March quarter from Rs 1,251 crore in the last quarter of 2019-20.

Income on a consolidated basis rose to Rs 43,621 crore from Rs 40,121 crore for the reported quarter.

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Gross non-performing assets (NPAs) or bad loans fell to 4.96 per cent of the gross advances by the end of March 2021 as against 5.53 per cent by March 31, 2020.

Net NPAs too came down to 1.14 per cent as against 1.41 per cent.

Provisions for bad loans and contingencies declined to Rs 2,883.47 crore in Q4, from Rs 5,967.44 crore parked aside in year ago same quarter.

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Here's what brokerages said after the lender announced its Q4 earnings.

Motilal Oswal said, "Liability franchise continues to improve with healthy CASA growth. The bank has delivered double-digit RoE (~12.6%) for the first time post FY17, and we expect RoA/RoE to improve to 1.7%/15.2% in FY23E. Buy with a target price of Rs 750 per share (2.4x FY23E ABV for the standalone bank).

LKP Securities raised the target price of stock by 23.3%.

"We expect the bank's loan book to grow cautiously at CAGR of 16% over FY21-23E, led by balanced growth across segment. In our opinion, the Banks credit cost will normalise by FY22E and estimate return ratio ROA/ROE of 1.6% and 13.6% in FY22E. We value the standalone entity with 2.2xFY23E BVPS ( Rs 268) and investment in subsidiaries and JVs ( Rs 113 per share); we arrive at an unchanged target price of  Rs 703. We recommend BUY rating with a potential upside of 23.3%."

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