See limited upside in ICICI Bank: Religare Capital Markets

Siddharth Teli of Religare Capital Markets told CNBC-TV18, "ICICI Bank's numbers were fairly good. It came in meaningfully higher than what our expectations are. So the beat in numbers was largely driven by margins being fairly resilient and Opex (operating expense) was much lower than expected. So I think these were the key two drivers as far as numbers were concerned."

"We believe that the other important thing in terms of numbers moreso from a trend perspective was reasonably good growth as far as retail assets were concerned. So adjusting for buyouts, the growth was 28 percent. So you also saw revival in fee income growth, which came in at 17 percent during the quarter which I don’t think has been the case in the last quite a few quarters, so it was a fairly good set of numbers," he added.

"The only issue that I see over here is that while margins are fairly good and the management has upped its guidance on net interest margins (NIMs) by 20 bps year-on-year (Y-o-Y), that clearly implies that we are closer to the uptick on margins from hereon. Also, they have upped their guidance on credit cost. So while the guidance until now was 75-80 bps that could be up now to 90-100 bps, so the restructuring and asset quality this quarter in terms of restructuring and slippages was fairly good."

"Going forward restructuring could go up meaningfully. That was the management guidance. So I think while numbers were fairly good, our call on the stock is that upsides could be limited. We are looking at closer to 15 percent kind of return on equity (RoE). So based on that at 1.4 times book, our target price is closer to Rs 1,100 and we don’t see a meaningful upside as far as ICICI Bank is concerned. It is one of our preferred picks in private space but I don’t see meaningful upside from current levels."