StockAxis

ICICI Bank Ltd

Quarterly Result - Q1FY23

ICICI Bank Ltd

Bank - Private

Current

CMP
Rs. 814.45
Rating:
Hold
August 23, 2022

Previous

Rating:
Hold

Stock Info

BSE
532174
NSE
ICICIBANK
Bloomberg
ICICIBC:IN
Reuters
ICBK.NS
Sector
Bank - Private
Face Value (Rs)
2
Equity Capital (Rs cr)
1383
Mkt Cap (Rs cr)
572744.87
52w H/L (Rs)
867.00 - 642.15
Avg Daily Vol (BSE+NSE)
2,631,104

Shareholding Pattern

(as on 30-Jun)
%
Promoter
43.54
FIIs
45.33
DIIs
0.23
Public & Others
10.90
Source: Ace equity, StockAxis Research

Price performance

Return (%)
1m
3m
12m
Absolute
16.95
11.11
20.80
Sensex
9.84
2.00
9.75
Source: Ace equity, StockAxis Research

Indexed Stock Performance

ICICI Bank Ltd Sensex
ICICI Bank Ltd
Source: Ace equity, StockAxis Research

Quarterly Highlights

ICICI Bank revenue grew 20% YoY to INR17,875cr, aided by healthy Other Income and NIM expansion. A sharp rise in Opex resulted in PPoP growing at a slower pace of 16% YoY to INR10,309cr. Core Operating Profit (excluding dividend income and treasury income) was up 21% YoY. PAT rose 50% YoY to INR6,905cr. Slippages were elevated but offset by robust recoveries and upgrades and write-offs. Hence, GNPA improved to 3.41% (vs. 3.6% in Q4FY22). RoA and RoE improved 44bps YoY and 400bps YoY to 2% and 15.9%, respectively.

Conference call highlights

  • Growth in SME and Business Banking portfolios was driven by leveraging a branch network, cross-selling to existing customers through digital offering. The bank invested heavily in digital propositions for this segment and that has helped growth, which was led by both WC and Term loans.
  • The bank will continue to leverage its technological capabilities to drive growth, which will aid in market share gains.
  • Around 43%/21%/6% of the loan book is linked to repo/MCLR/other external benchmarks. The remainder of loans is at a fixed rate.
  • Overseas loan book growth was primarily driven by an India-linked trade finance book. Of the overall overseas book, 87% of exposure is towards Indian corporates, 6% to overseas India-linked entities while the remaining 4% is towards NRI and 3% is non-India corporate.
  • Bank activated 7.3mn of iMobile pay by Non-ICICI bank account holder in Q1FY23.
  • Credit card spending grew by 12.6% (2x in terms of value spent than Q1FY22) driven by higher discretionary spending & activation rates through digital on-boarding of customers.
  • Sequential increase in the outstanding to NBFC & HFCs (8% of advances) is mainly due to disbursements to well-established public sector entities.
  • Revolve rates in Credit Card portfolio remained below pre-COVID levels, expected to move up by the end of FY23.
  • Retail term deposits have 12-18 months durations, likely the case across banks.
  • Bank liquidity position continues to remain high with average LCR standing at 130%.

Outlook & valuation

ICICI Bank has built a strong and resilient retail banking portfolio with strong digital capabilities to provide customized cutting edge digital solutions, which is helping the bank gain market share across business segments. In the medium-term, stable margin and fee income would push return ratios. We expect strong liability franchise and consolidation in banking industry will help the bank to gain market share. The management continues to highlight its clear focus on maximising risk-optimised core operating profit growth. At current market price of Rs 800 stock trades at valuation of 2.6x FY24E P/ABV on Standalone basis.

Quarterly Financials

Particulars (Rs. in cr.) Q1 FY23 Q1 FY22 Y-o-Y % Q4 FY22 QoQ % FY22 FY21 YoY %
Interest Earned 23672.00 20383.00 16.00% 22675.00 4.00% 86375.00 79118.00 9.00%
Interest Expended 10462.00 9448.00 10070.00 38908.00 40129.00
Net Interest Income 13210.00 10935.00 21.00% 12605.00 5.00% 47466.00 38989.00 22.00%
Other Income 4665.00 3996.00 4737.00 18518.00 18969.00
Total Income 17875.00 14931.00 20.00% 17342.00 3.00% 65984.00 57958.00 14.00%
Employee Expense 2849.00 2374.00 2429.00 9673.00 8092.00
Other Operating Expense 4717.00 3663.00 4590.00 12440.00 13469.00
Total Operating Expense 7566.00 6037.00 25.00% 7049.00 7.00% 26733.00 21561.00 24.00%
Pre-Provisioning Operating Profit 10309.00 8894.00 16.00% 10293.00 0.00% 39250.00 36397.00 8.00%
Provisions 1144.00 2852.00 1069.00 8641.00 16214.00
Profit before Tax 9165.00 6042.00 52.00% 9224.00 -1.00% 30609.00 20183.00 52.00%
Tax 2260.00 1426.00 2205.00 7269.00 3990.00
Profit after Tax 6905.00 4616.00 50.00% 7019.00 -2.00% 23339.00 16193.00 44.00%
Earnings Per Share (EPS) 10.00 6.50 52.00% 10.00 -2.00% 34.00 24.00 42.00%
Gross NPA (%) (standalone) 3.00 5.15 4.00 4.00 5.00
Net NPA (%) (standalone) 0.70 1.12 0.80 0.76 1.14

Source: Company Filings; StockAxis Research

Standalone Financial statements

Profit & Loss statement

Particulars (Rs. in cr.) FY18 FY19 FY20 FY21 FY22 FY23E FY24E
Interest Earned 54966.00 63401.00 74798.00 79118.00 86375.00 102011.00 120638.00
Interest Expended 31940.00 36386.00 41531.00 40129.00 38908.00 47297.00 57706.00
Net Interest Income 23026.00 27015.00 33267.00 38989.00 47466.00 54714.00 62932.00
Other Income 17420.00 14512.00 16449.00 18969.00 18518.00 22374.00 25151.00
Total Income 40446.00 41527.00 49716.00 57958.00 65984.00 77088.00 88082.00
Employee Expense 5914.00 6808.00 8271.00 8092.00 9673.00 10464.00 12034.00
Other Operating Expense 9790.00 11281.00 13344.00 13469.00 12440.00 18058.00 20557.00
Total Operating Expense 15704.00 18089.00 21615.00 21561.00 26733.00 28522.00 32591.00
Pre-Provisioning Operating Profit 24742.00 23438.00 28100.00 36397.00 39250.00 48565.00 55492.00
Provisions 17307.00 19661.00 14053.00 16214.00 8641.00 8450.00 9989.00
Profit before Tax 7435.00 3777.00 14047.00 20183.00 30609.00 40115.00 45503.00
Tax 657.00 413.00 6117.00 3990.00 7269.00 8946.00 10011.00
Profit after Tax 6778.00 3364.00 7930.00 16193.00 23339.00 31169.00 35493.00
Earnings Per Share (EPS) 10.00 5.00 12.00 24.00 34.00 45.00 51.00

Balance Sheet

Particulars (Rs. in cr.) FY18 FY19 FY20 FY21 FY22 FY23E FY24E
Share Capital 1286.00 1289.00 1295.00 1383.00 1390.00 1390.00 1390.00
Reserves 103873.00 107080.00 115211.00 146123.00 168856.00 197953.00 230684.00
Shareholders Fund 105159.00 108369.00 116505.00 147506.00 170512.00 199343.00 232074.00
Deposits 560975.00 652920.00 770969.00 932522.00 1064572.00 1213035.00 1407120.00
Borrowings 182859.00 165320.00 162897.00 91631.00 107231.00 123316.00 141813.00
Other Liabilities and Provisions 30196.00 37851.00 47995.00 58770.00 68983.00 97086.00 98557.00
Total Liabilities 879189.00 964460.00 1098366.00 1230433.00 1411298.00 1632780.00 1879565.00
Fixed Assets 7904.00 7931.00 8410.00 8878.00 9374.00 9843.00 10433.00
Advances 512395.00 586647.00 645291.00 733729.00 859020.00 1005465.00 1181536.00
Investments 202994.00 207733.00 249531.00 281287.00 310241.00 358303.00 415631.00
Cash & Bank Balance 84169.00 80296.00 119156.00 133128.00 167822.00 162836.00 159191.00
Other Assets 71727.00 81852.00 75978.00 73411.00 64840.00 96334.00 112774.00
Total Assets 879189.00 964460.00 1098366.00 1230433.00 1411298.00 1632780.00 1879565.00

Key Ratios

Particulars (Rs. in cr.) FY18 FY19 FY20 FY21 FY22 FY23E FY24E
Earnings Per Share (Rs) 10.50 5.20 12.10 24.40 33.70 44.80 51.10
Adj DPS (Rs) 2.50 1.50 1.00 1.00 1.50 1.50 1.50
Book Value (BV) (Rs) 161.60 166.10 178.00 211.20 243.00 284.80 331.90
Price / BV 1.70 2.40 1.80 2.90 3.10 3.20 2.40
Advance Book Value (ABV) (Rs) 161.60 163.80 172.00 194.60 227.10 263.90 308.40
Price / ABV 1.70 2.40 1.90 3.20 3.30 3.00 2.60
NIIM (%) 3.10% 3.50% 3.80% 3.70% 3.80% 3.90% 3.90%
ROA (%) 0.80% 0.40% 0.80% 1.40% 1.80% 2.00% 2.00%
ROE (%) 6.40% 3.20% 7.10% 12.40% 14.80% 15.00% 16.60%
Cost to Income Ratio 38.80% 43.60% 43.50% 37.20% 40.50% 37.00% 37.00%
Total Debt/Equity(x) 707.30% 755.00% 801.60% 694.30% 687.20% 670.40% 667.40%
GNPA (%) 8.80% 6.70% 5.50% 4.20% 3.50% 3.10% 2.70%
NPA (%) 4.80% 2.10% 1.40% 0.60% 0.50% 0.40% 0.30%
Cost of Funds 4.60% 4.70% 4.70% 4.20% 3.50% 3.80% 4.00%