ICICI Bank is the second largest private bank of India and has a leading position in other financial services businesses through its subsidiaries. The bank offers a wide range of banking and financial services including commercial banking and treasury operations to large set of customers viz. large and mid-corporates, MSME, agriculture and retail businesses. The Bank’s business segments include Retail Banking, Wholesale Banking, Treasury, and Other Banking. The bank is working with a widespread network of over 5,718 branches and 13,186 ATMs across country.
| Result Analysis: ICICI Bank Limited (CMP: Rs.992) | Result Update: Q1FY24 |
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Stock Details |
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| Market Cap. (Cr.) | 6,97,409 |
| Equity (Cr.) | 1399.44 |
| Face Value | 2 |
| 52 Wk. high/low | 1002 / 780 |
| BSE Code | 532174 |
| NSE Code | ICICIBANK |
| Book Value (Rs) | 300.85 |
| Sector | Banks |
| Key Ratios | |
| ROE (%): | 15.47 |
| TTM EPS: | 48.64 |
| P/BV: | 3.30 |
| TTM P/E: | 20.49 |
Result Highlights:
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ICICI Bank reported strong numbers in Q1FY24 by laying 44% YoY and 8% QoQ increase in the consolidated net profit to Rs.10,636 cr.
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Net Interest Income of the bank grew significantly with an increase of 37.6% YoY and 3.9% QoQ to Rs.20,738 cr. while Net Interest Margin decreased by 12 bps sequentially and increased by 77 bps on yearly basis.
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Banks’s total advances grew by 17.5% YoY and 3.8% QoQ to Rs.11.25 lakh cr. led by healthy retail and domestic loans. Personal loans, Vehicle loans and Credit cards, all contributed to this growth. The corporate book also reported a strong improvement (up 4% QoQ), while the SME book increased by 29% YoY.
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Total deposits aggregated to Rs.12.69 lakh cr. as of June’23, a growth of 17.8% YoY and 4.8% QoQ with CASA deposits aggregating 43% and term deposits 57%. The deposits growth was mainly driven by term deposits.
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CASA deposits of the bank grew by 9% YoY to Rs.53.62 lakh cr. with savings account deposits accounting 30.3% and current account deposits accounting to 13% of total CASA. CASA ratio declined by 100 bps on QoQ and by 320 bps on YoY basis at 42%.6.
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Asset quality of the bank remained stable in the quarter with Gross NPA of 2.76%, decrease of 65 bps YoY and Net NPA ratio at 0.48%, decrease of 22 bps YoY. Bank has added 1807cr. in the total slippages vs 382 cr. in Q1FY23.
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Bank has added 174 branches and 80 ATMs in the quarter, aggregated to total 6074 branches and 16,731 ATMs at the end of June’ 2023.
Financial Performance:
Shareholding Pattern:
| Particulars (In %) | Q1FY24 | Q1FY23 |
| Promoters Group | 0.00 | 0.00 |
| FIIs | 36.42 | 53.48 |
| DIIs | 36.51 | 37.76 |
| Public | 25.86 | 7.21 |
| Others | 1.21 | 1.55 |
Conference Call Highlights:
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The Cost of funds scaled by 30bp QoQ to 4.6%, and the bank anticipates that it will continue to rise throughout subsequent quarters.
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Cost of Deposits grew from 3.98% in the 4QFY23 to 4.31% in the 1QFY24. A delay in deposit repricing will cause deposits to cost more in following quarters as well.
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Total provisions (including contingent provisions) other than PCR-related provisions were Rs 223.5 billion (210 basis points of loans). Additionally, the bank has Rs 12.2 billion in provisions for borrowers that are under resolution, which is more than what is required by RBI norms.
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NIM decreased from 4.9% in the 4QFY23 to 4.78% now. The bank expects that NIM would continue to decline in the following quarters.
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The use of digital platforms by clients is steadily growing. By non-ICICI Bank account holders, iMobile Pay has been activated more than 10 million times as of June 23.
Outlook:
ICICI Bank reported another consistent quarter, supported by strong NII/Core operating profit growth, regulated provisioning, and stable asset quality. NII growth was driven by a consistent combination of a high-yielding portfolio (Retail/Business Banking) and a low-cost liabilities franchise. The bank is experiencing a robust recovery across all areas, and asset quality indicators are still looking good with a PCR of about 83%. The bank differentiates itself by its excellent liability mix, robust digital capabilities, and improved core PPoP metrics. Considering all these, we continue to have a bullish outlook for the ICICI Bank
Results:
| Particulars (In Rs. Cr.) | Q1FY24 | Q4FY23 | Q1FY23 | QoQ% | YoY% |
| Interest Earned | 37,106 | 34,439 | 26,159 | 7.7% | 41.8% |
| Interest Expended | 16,368 | 14,479 | 11,089 | 13.0% | 47.6% |
| Net Interest Income | 20,738 | 19,959 | 15,070 | 3.9% | 37.6% |
| Operating Profit | 15,660 | 15,206 | 11,123 | 3.0% | 40.8% |
| Provisions | 1,345 | 1,722 | 1,131 | -21.9% | 18.9% |
| Tax | 3,551 | 3,499 | 2,505 | 1.5% | 41.8% |
| Net Profit after tax | 10,636 | 9,853 | 7,385 | 8.0% | 44.0% |
| Deposits | 12,69,343 | 12,10,832 | 10,77,790 | 4.8% | 17.8% |
| Advances | 11,24,875 | 10,83,866 | 9,57,207 | 3.8% | 17.5% |
| Ratios (%) | Q1FY24 | Q4FY23 | Q1FY23 | QoQ | YoY |
| Gross NPA | 2.76 | 2.81 | 3.41 | -5 bps | -65 bps |
| Net NPA | 0.48 | 0.48 | 0.70 | – | -22 bps |
| Net Interest Margin | 4.78 | 4.90 | 4.01 | -12 bps | 77 bps |
| Capital Adequacy Ratio | 16.7 | 18.3 | 18.0 | -163 bps | -133 bps |
| Slippages (In Cr.) | 1807 | 14 | 382 | 1793 | 1425 |
| CASA Ratio | 42.6 | 43.6 | 45.8 | -100 bps | -320 bps |
Source: Company website, EWL Research
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