ICICI Bank Shares Surge Nearly 3% Post Q2 Results: What Should You Consider for Investment Now?
Editor
2 min read
ICICI Bank’s shares have been performing quite well lately, with positive returns seen over various time periods. In the last three months, the stock has increased by 4%, and over six months, it has gone up by 8.57%. If we look at the year-to-date performance, shares have shot up by 26.04%, and in the past twelve months, the growth is a noteworthy 36.19%. This clearly shows how strong the stock has been.
Today, ICICI Bank shares jumped nearly 3%, reaching an intra-day high of ₹1294.55 on the NSE, after the bank reported a 14.5% rise in its standalone net profit for the September quarter. The profit stood at ₹11,746 crore, up from ₹10,261 crore during the same period last year.
Strong Deposits and Loan Growth
ICICI Bank saw an impressive growth in average deposits, which increased by 15.6% year-on-year, amounting to ₹14,28,095 crore as of September 30, 2024. The average current account and savings account (CASA) ratio was reported at 38.9% for Q2FY25. The domestic loan portfolio also showed robust growth of 15.7% YoY, reaching ₹12,43,090 crore.
Asset Quality and Capital Adequacy
As for asset quality, the net NPA ratio was noted at 0.42% as of September 30, 2024, slightly better than the 0.43% recorded on June 30, 2024. The provisioning coverage ratio for non-performing loans stood at 78.5% at the end of Q2FY25.
Key Highlights of Q2FY25
The bank’s net interest income (NII) experienced a year-on-year increase of 9.5%, rising to ₹20,048 crore in Q2FY25 from ₹18,308 crore in Q2FY24. However, the net interest margin dropped to 4.27% for Q2FY25, down from 4.36% in Q1FY25 and 4.53% in Q2FY24. Core operating profit also saw positive growth, increasing by 12.1% YoY to ₹16,043 crore in Q2FY25.
Brokerage Views on ICICI Bank
Macquarie has kept an outperform rating with a target price of ₹1,350, noting that ICICI Bank is managing to maintain growth while keeping a close watch on asset quality.
Nomura has raised its target price to ₹1,575 from ₹1,420, calling the latest quarter “flawless” due to strong loan and deposit growth, alongside solid asset quality.
Jefferies also maintains a buy rating, increasing its target price to ₹1,550 from ₹1,460. The firm highlighted that the growth in deposits is positively affecting loan growth, while operating efficiencies are boosting profits.
Performance Overview Over the Last Year
Overall, ICICI Bank shares have shown consistent positive returns. Over the past three months, they rose by 4%, while in the last six months, the growth was 8.57%. Year-to-date, the shares have surged by 26.04%, and looking back at the last twelve months, the impressive growth stands at 36.19%. These results indicate the stock’s strong performance and attractiveness to investors.
In conclusion, given the strong fundamentals and positive outlook from various brokerages, ICICI Bank seems to be a solid option for investment moving forward. However, as always, investors should consider their own risk appetite and investment strategy before making any decisions.
