Arihant Capital has given Buy recommendation for ICICI Bank with a target price of Rs. 968 in its research report issued on Jan 23, 2022
Arihant Capital’s research report on ICICI Bank
ICICI Bank reported another quarter of stellar performance on most counts with improvement in asset quality. Profit for the quarter grew strongly by 25% YoY/12% QoQ to INR 6,194 cr, was higher than our estimate of INR 5,726 cr. NII for the quarter grew by 23% YoY/5% QoQ to INR 12,236 cr, led by strong advances growth of 16% YoY. Core PPOP grew by 25% YoY to INR 10,060 cr supported by strong fee income growth of 19% YoY. Headline NPA ratio of the bank improved further with GNPA reduction of 69bps QoQ and NNPA decreased by 14bps QoQ led by negative net slippages, strong recoveries and write off. Restructured pool of the bank remained flat at INR 9,684 cr or 120 bps of advances. Bank has not utilized any covid provision during the quarter and continue to hold provision buffer of INR 6,425 cr (0.8% of advances) which provides comfort over balance sheet position.
We maintain our Buy rating on the stock with a revised SOTP based target price of INR 968 (INR 942 earlier), based on 2.6x FY24E P/ABV for standalone bank and INR 163 for subsidiaries.