ICICI Bank's locked-in FCNR funding, broad-based loan growth, strong asset quality and Rs 13,100 crore contingency buffers support sustainable earnings growth. Key monitorables include the Q3 net interest margin dip, lower CASA, declining credit-card book, slower gold-loan growth and RBI's review of the agri portfolio, highlights IDBI Capital.
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IDBI Capital Report
The brokerage firm IDBI Capital highlighted that ICICI Bank Ltd. delivered a strong Q2 FY27 with robust balance-sheet growth, healthy core profitability and further asset-quality improvement.
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Advances grew 30.0% YoY/12.3% QoQ to Rs 18.3 trillion, while deposits rose 27.1% YoY/11.8% QoQ to Rs 20.5 trillion.
Excluding Foreign Currency Non-Resident (Bank), loan and deposit growth stood at 24.1% and 17.0% YoY, respectively, with the FCNR(B) window contributing ~10%t to deposit growth.
Net interest income grew 17.7% YoY to Rs 25,339 crore, operating profit rose 21.8% to Rs 2,080.5 crore, and PAT increased 20.1% to Rs 14,843 crore.
RoA/RoE stood at 2.26%/16.6%. Gross non-performing asset/net non-performing asset improved to 1.20%/0.30%. The management expects a further NIM dip in Q3, followed by a healthy recovery from Q4.
IDBI Capital has maintained a Buy rating on ICICI Bank with a target price of Rs 1,730, the stock trades at 2.5x 1-year forward price/adjusted book-value.
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