Sharekhan's research report on ICICI Bank
Pressure on NIMs is expected to be partly offset by contained opex growth. Deposit growth continues to be in line with loan growth and LDR remains lowest among large private banks thus loan growth outlook continues to remain healthy for the bank. Asset quality continues to be healthy along with strong provisioning buffer outside PCR (1.1% of loans) should keep credit cost lower. Thus, we believe that among large private banks, it is well-positioned to deliver superior growth/ return trajectory. The stock trades at 2.3x/1.9x its FY2025E/FY2026E core BV estimates.
Outlook
We maintain a Buy rating on ICICI Bank with a revised PT of Rs. 1,300. Pressure on NIMs is likely to persist in the near term, but we still see the bank sustaining its RoA at over ~2% in near to medium term.
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