ICICI Bank Q1 beats forecast, net rises 36% to Rs 1815 cr

India's largest private sector lender ICICI Bank 's first quarter (April-June) net profit rose by a forecast beating 36% year-on-year to Rs 1,815 crore driven by a drop in non-performing assets (NPAs) coupled with a robust growth in loan book that expanded 22% y-o-y to Rs 2.68 lakh crore.

Net interest income (NII) or the difference between interest earned and paid out increased more than 32% to around Rs 3,200 crore during the three-month period. Fee income rose by 14.4% year-on-year to Rs 1,880 crore.

According to CNBC-Awaaz poll estimate, analysts on an average had expected 30% rise in net profit and NII was seen at Rs 3061 crore, up 27% y-o-y.

"We are maintaining our target of 20% loan growth in FY13. Retail loans are likely to expand at 10-15% through segments like housing, vehicle financing and others. In corporate loans, we will only focus on working capital loans and existing project loans," Chanda Kochhar, managing director & CEO, ICICI Bank told reporters in a conference call.

During the quarter, the gross NPA ratio fell to 3.54% as against 3.62% in the Jan-March quarter and 4.36% in Q1, FY12. However, net NPA ratio too improved a tad to 0.71% (at Rs 1,941 cr) from 0.73% quarter-on-quarter. This suggests that loan provisions did not increase much. Net NPA ratio is determined after deducting loan provisions from gross NPAs.

"Three reason added to our higher interest income: lower reliance on bulk deposits, higher yield on advances and higher net interest margin from your international divisions," Kochhar said.

At the same time, the bank's restructured assets fell marginally to Rs 4,172 crore compared with Rs 4,256 crore in Q4, FY12. Market was apprehensive of the lender's recast cases. The improvment added to investors' confidence. At 13.10 hrs, ICICI Bank shares were trading at Rs 927, up 2.30%.

The bank managment is not expecting any major rise in restructured book. However, it is not clear whether any big account is likely to figure in their restructured book.

In Q1, provisions slipped marginally to Rs 466 crore as against Rs 469 crore in Q4, FY12 and Rs 454 crore in Q1, FY12. Provisions included a component of general provisions of Rs 76 crore on standard assets.

However, the bank's deposits grew at a slower pace by 16% y-o-y to around Rs 2.68 lakh crore. The share of savings and current accounts to total deposits stood at 40.6% as on June 30, 2012 while savings account deposits increased 17% y-o-y to about Rs 78,000 crore.

"Our total deposits would grow in the range of 18-20% y-o-y. The CASA ratio will be in the range of 38-40%," said Kochhar.

On consolidated basis, ICICI Bank reported 25% y-o-y growth in its Q1 net profit at Rs 2,077 crore.

saikat.das@network18online.com