Motilal Oswal has given Buy recommendation for ICICI Bank recommended buy rating on the stock with a target price of Rs 1050 in its research with a target price of Rs. 1050 in its research report issued on Apr 23, 2022
Motilal Oswal’s research report on ICICI Bank
ICICIBC reported an all-round improvement in operating performance, with core PPOP up 21% YoY (excluding dividends), margin improving by 4bp QoQ to 4%, and robust asset quality driving a sharp decline in credit cost, even as the bank increased its contingent provision buffer by INR10.25b. The bank reported a RoA/RoE of 2.1%/17% in 4QFY22. Business growth continues to gain traction, with a jump of 17% YoY and 6% QoQ, led by Retail, SME, and Business Banking. RoE crossed the 15% mark in 3Q and 4QFY22 saw a further rise (~170bp). While the stock has done well on a relative basis, current valuations leave ample scope for a re-rating. The stock is well-positioned to undergo a swift re-rating over FY23, generating strong returns for the investors, as ICICIBC continues with its journey to deliver solid return ratios and growth. We expect the bank to deliver a RoA/RoE of 1.9%/16.3% in FY24. ICICIBC remains our top pick in the sector.
We maintain our Buy rating with a SoTP-based TP of INR1,050 per share (based on 2.8x FY24E ABV for the core bank), implying a potential upside of 40%. ICICIBC remains our top pick in the sector.