ICICI Bank Q1 PAT seen up 30% YoY at Rs 1,730 cr

Moneycontrol Bureau

The restructured loan book and loan growth outlook are likely to drive ICICI Bank's first quarter earnings to be announced on Friday afternoon.

The largest private sector lender is likely to report nearly 30% year-on-year rise in its April-June quarter net profit to Rs 1,730 crore. The net interest income or the difference between interest earned and paid out, is seen to be up by 27% YoY to Rs 3,061 crore, according to a poll estimate by CNBC-Awaaz.

"In view of ongoing economic slowdown, some banks are revising their loan growth target. Market is keen to know whether similar moderation is happening for ICICI Bank as well. Management guidance on this will be closely followed. Earlier the bank was looking to expand its loans book in the range of 18-20% in 2012-13," Manish Ostwal, banking analyst from brokerage firm KR Choksey told moneycontrol.com.

In Jan-March quarter, the bank's loan book rose 17% YoY to Rs 2.54 lakh crore. Domestic loans constituted around 76% of the book while the international segment added the rest 24%. Out of total domestic loans, the share of retail loans stood at 35%, corporate loans at 23% and agriculture credit at 8.8%. Small and medium enterprises formed a little more than 5%. The lender's restructured book stood at around Rs 3,800 crore.

On an average, analysts expect flat loan book quarter-on-quarter basis. However, the share of retail loans may go up compared to corporate loans.

"Incremental loan restructuring cases will not auger well for the bank. The management commentary on the restructuring pipeline is important. Loan defaults are not expected to come in one go. If it happens at all, this will show up gradually. The net interest margin (NIM) is likely to squeeze marginally," said Bhavesh Kanani, AVP - Equity Research, Centrum broking.

The bank management had said, it was not expecting any ugly surprise on bad loans.

Key points to watch:

• Asset quality - restructured loans
• Consistency in loan growth
• Fee income
• Net interest margin

saikat.das@network18online.com