Buy ICICI Bank; target of Rs 1120: Motilal Oswal

Motilal Oswal's research report on ICICI Bank

ICICI Bank (ICICIBC) reported yet another quarter of strong performance, with 22% YoY growth in core profitability. However, margins contracted 25bp QoQ. Credit growth was robust at 18% YoY, led by continued traction in Retail, SME and BB segments. Deposits saw healthy growth of 19% YoY.  Asset quality continued to surprise positively as provisions came in 51% below MOFSLe and GNPA/NNPA ratio improved further. The bank maintains a total contingency buffer of INR131b (2.1% of loans), which provides comfort.

Outlook

We raise our FY24/FY25 EPS estimates by 3%/4% and expect ICICIBC to deliver RoA/RoE of 2.3%/18.3% in FY25. Maintain BUY with a revised TP of INR1,120.