Q4FY23 Preview: ICICI Bank: NII seen at Rs 17,239 crore, PAT at Rs 8,867 crore

21 Apr 2023 , 10:36 AM

Result date: 22^nd April, 2023

Recommendation: Buy

Target price: Rs 1,140

(Source: IIFL Research)

ICICI Bank is likely to post 18% growth in advances following broad-based credit demand in all segments, especially SME and Retail.

A steady mix of a high-yielding book such as Retail/Business banking, deployment of excess liquidity, and a low-cost liability franchise together could aid margins during the quarter. Given that 70% of the Bank’s loans are floating in nature and ~45%/4% are linked to repo/other EBLR, margins are likely to remain healthy.

ICICI Bank has been aggressive as far as provisioning is concerned. Its Provision Coverage Ratio of 83% is among the highest in the industry – and carries COVID-related provisions. The bank has witnessed moderation in slippages in the past few quarters and the trend is expected to continue in Q4 as well. Overall, credit costs are expected to remain under control. 

Important management insights to watch out for:

• Traction in deposits and rise in cost of deposits
• Outlook on margin
• Traction in credit card and overall business
• Outlook on credit costs, asset quality

Rs. Crore	March 2023 estimates	YoY change	QoQ change
Net Interest Income	17,239	36.8%	4.7%
Pre Provisioning Operating Profit	13,997	36.0%	5.5%
Profit After Tax	8,867	26.3%	6.7%

Source: Brokerage Reports