Emkay Global Financial Services has come out with a research report on ICICI Bank's Q2FY10 earnings. The research firm has maintained hold rating on the stock with price target to Rs 750.

"ICICI Bank’s Q2FY10 net profit came in at Rs 10.4 billion, inline with estimates; however NII at Rs 20.4 billion was marginally below our expectations. The marginally lower than expected NII was driven by a very moderate 9bps qoq expansion in NIMs and 14% yoy decline in advances. Some of the positives in the results 1) 646bps improvement in CASA mix to 36.9% 2) Improvement in asset quality and 3) sequential uptick in fee income after six quarters of decline. The asset quality seen some improvement during the quarter as the bank wrote-off Rs 6 billion of retail assets and sold Rs 7 billion to Arcil. The GNPA declined by Rs 2.3 billion sequentially to Rs 94.7 billion, while net NPA decline by Rs 1.1 billion sequentially to Rs 45.6 billion. Moreover the slippages came down to Rs 11 billion from Rs 13.2 billion in the preceding quarter. At CMP, the stock trades at 1.8x FY10 ABV and 1.7x FY11 ABV. We are leaving our estimates unchanged for FY10 and FY11. However, we believe that at current market price, the stock is currently fairly valued. We maintain our hold rating on the stock with price target to Rs 750", says Emkay Global Financial Services.

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