CLSA has reiterated its ‘Outperform’ rating on ICICI Bank and increased the target price to ₹1,700 after the bank posted yet another strong quarterly performance. Pre-provision operating profit (PPOP) and profit after tax (PAT) surpassed estimates by 8% and 11%, respectively.
The brokerage noted that the March quarter showcased ICICI Bank’s strategic pivot toward profitability over growth. While loan growth moderated to low-teens from the earlier mid-teen levels, net interest margin (NIM) saw a surprise expansion of 15 basis points quarter-on-quarter. Even after adjusting for accounting and one-off factors, NIM would still be up by 6–7 basis points, leading to a beat on net interest income (NII).
Additionally, operating expenses surprised on the positive side. The management had earlier guided that FY25 opex growth would be lower than loan growth, and the bank delivered on that promise. Asset quality also remained strong, with slippages improving during the quarter.
Disclaimer: The above views are of the broker’s and not the author or the publication’s. Please make any and every investment decision after consulting your financial advisor.
