Prabhudas Lilladher is bullish on ICICI Bank has recommended buy rating on the stock with a target price of Rs 520 in its research report dated November 01, 2020.
Prabhudas Lilladher's research report on ICICI Bank
ICICIBC’s PAT of Rs42.5bn saw a strong boost versus expectations (PLe: Rs24.9bn) on lowering provisioning as bank feels it is at quite comfortable levels to absorb hits and see a normalized credit cost by FY22. Overall operations were steady & in-line. Collections efficiency is improving to near to pre-COVID, while overdue loans is still 3-4% higher than pre-COVID and should improve ahead. On restructuring bank is seeing a very low outcome with corporate restricted to <1% of loans and retail under control. We have maintained that with its strong franchise, high capital level, fully covered on legacy asset quality with high PCR unlike last cycle and lower hits from COVID as anticipated earlier aids to our conviction.
We retain BUY with revised TP of Rs520 (from Rs462) based on 1.8x Sep FY22 ABV largely on rollover from Mar-22 and incorporating capital raising.
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