ICICI Bank Q4 net rises 21%, shares fall on profit booking

Moneycontrol Bureau

India's largest private sector lender ICICI Bank on Friday reported 21 percent year-on-year rise in its fourth quarter (January-March) net profit at about Rs 2,300 crore on standalone basis, driven by robust growth in net interest income (NII) or the difference between interest earned and paid out. During the same period, NII grew forecast beating 22 percent to Rs 3,800 crore. Also read: ICICI Bk rules out money laundering, sees transaction error
Analysts on an average were expecting net profit at Rs 2307 crore (or 21 percent Y-o-Y) and NII at Rs 3,644 crore (or 17 percent Y-o-Y) for the quarter.
"We have achieved this performance due to growth in balance sheet and improvement in profitability indicators," Chanda Kochhar MD & CEO, ICICI Bank told reporters while announcing the Q4 earnings.
"We have restructured Rs 788 crore during the quarter. It was expected at Rs 1,000 crore. In the current financial express, the outlook for restructuring depends on operating environment. Our retails loans rose at faster pace by 25 percent during the year," she said.
ICICI Bank's outstanding restructured book was at Rs 5,315 crore as on March 31, 2013; in comparison with Rs 4,554 crore recorded in the corresponding quarter of the previous year. Loan restructure means that a lender relaxes its orginal terms and conditions observing stress in repayments.
However, ICICI Bank shares dropped 3 percent to close the day's trading at Rs 1,144.50 on NSE. The bank declared a dividend of Rs 20 per share as against Rs 16.5 announced a year back.
In last five trading days, ICICI shares shot up more than 4 percent compared with 2 percent rise in Bank Nifty - the broader index for banking stocks.
"ICICI shares rose sharply in the last few days. Shares may have fallen due to profit booking. The bank has reported good set of numbers. However, we need to see the management commentary on its restructuring outlook," said Vaibhav Agrawal, vice president-research at Angel Broking.
Bank loans expanded 14 percent year-on-year to Rs 2.90 lakh crore. Currently, the share of retail loans stood at 37 percent while corporate loans was at 32.50% of the total credit book. SME loans formed more than 5 percent. ICICI Bank achieved 90 percent of its priority sector lending target mandated at 40% by RBI.
Gross non-performing asset (NPA) ratio improved to 3.22 percent compared with 3.62 percent a year back. Net NPA ratio stood at 0.77 percent as against 0.73 percent during the same time. Net NPAs are arrived at after deducting provisions from gross NPAs. Provisions against bad loans decreased from Rs 470 crore to Rs 460 crore Y-o-Y.
The bank posted 29 percent rise in its net profit to Rs 8,325 crore for the year ended March 31, 2013.  Net interest margin (NIM) rose by 38 basis points to 3.11 percent Y-o-Y.
"Retail loans would grow 30% in FY14. For corporate credit, working capital loans are on demand currently. In the second half of the year, there could be some revival in loans to companies. There will be a lag between policy rate and lending rate cuts," Kochhar said.
Deposits grew 15 percent Y-o-Y to Rs 2.93 lakh crore. The share of low cost current and savings account (CASA) improved from 37.4 percent to 38.10 percent quarter-on-quarter.
For the year ended March 31, 2013; the capital adequacy ratio was at 18.74%. During the year, the bank repatriated USD 100 million (or around Rs 540 crore) from its UK-based branch. Repatriation of capital means transfer of the bank's money from a foreign country to home country.
saikat.das@network18online.com