Shares of ICICI Bank continued their northward journey with the stock hitting a new record high of Rs 942.7 on BSE in the opening session of Tuesday, after the bank delivered strong results for the second quarter ended September 2022 or Q2 FY23.
In the last five days, the counter has given a positive return of over 4 per cent. This is clearly because the lender delivered strong results in the quarter ended September 30, 2022 (Q2-2023).
While the company’s core operating profit grew 24 per cent year-on-year to Rs 11,765 crore, profit after tax grew 37 per cent.
Further, the asset quality of the bank has improved and gross NPAs stood at 3.19 per cent in Q2 of FY23, from 3.41 per cent in Q1 of FY20 and 4.82 per cent in Q2 of FY23. The net NPA ratio improved to 0.61 per cent in Q2 of FY23 from 0.70 per cent in Q1 of FY23 and 0.99 per cent in Q2 of FY22.
As of September 30, 2022, bank deposits grew by 12 per cent annually to Rs 1,090,008 crore, while advances grew 23 per cent to Rs 938,563 crore.
Should you buy, hold or sell?
“ICICI Bank delivered a strong outperformance among large banks and highest growth in NII, even on a higher basis. ICICI maintains its position as the best-in-class performer for the eighth quarter, outperforming on every metric from core PPOP to treasury and buffer provisions. We repeat ‘BUY/SO’ and the top pick. We are confident that the Bank can continue to work on credit growth and NIM expansion on a higher basis as well. Reiterating its ‘Buy’ rating on ICICI Bank shares with a target price of Rs 1,115, Edelweiss said, “Best earnings are likely to continue for eight consecutive quarters and NIM expansion.”
“ICICI Bank reported strong 2QFY23 performance on the back of strong credit growth, multi-quarter higher margins and lower credit costs. Credit growth came in at 22.7 per cent year-on-year, largely led by all segments. OPEX growth came higher as the bank continued to invest in technology. Gross crime declined sharply, leading to an improvement in asset quality,” said Nirmal Bang.
HSBC Broking maintains ‘Buy’ call on ICICI Bank and raises target to Rs 1,100 from Rs 1,020. Similarly, Morgan Stanley has maintained ‘overweight’ rating on ICICI Bank and has set a share price target of Rs 1,250.
Shares of ICICI Bank have gained 21.49 per cent so far this year. This is much better than the rise of around 0.51 in the broader Nifty 50 during this period. Similarly, so far this year, the stock has outperformed the BSE with a gain of 21.63 per cent, compared to a gain of around 1.01 per cent in the benchmark BSE Sensex during the period.
When trading was allowed in the markets from 6.15 pm to 7.15 pm on Monday, investors were quick to add ICICI Bank shares to their portfolios. The stock rose nearly 3 per cent in just one hour. It touched an intraday high of Rs 932.90, just a short walk from the 52-week high of Rs 936.35.
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