Home >Home-page >ICICI Bank shares end at record high

Mumbai: Shares of ICICI Bank Ltd closed at an all-time high on Wednesday, after a number of brokerage firms recommended a “buy" rating for the stock, following the announcement of the bank’s September-quarter results on 26 October.

The stock ended up 1.58% on the BSE on Wednesday. It has gained 16% since 26 October.

The country’s second-largest private lender took the Street by surprise by reporting profits for the September quarter after a loss-making June quarter. The profit was aided by margin expansion and lower provisions on account of improved asset quality.

At 909 crore, the bank’s net profit for the September quarter was 55.8% lower from 2,058 crore a year ago. During the second quarter, fresh slippages fell to 3,120 crore, the lowest in the past eight quarters.

“With a declining trend in fresh slippages after several quarters, we believe that the peak of NPA recognition cycle is over now. Incremental additions to NPAs are expected to stay significantly lower than the previous years," Emkay Global said in a 26 October report.

Provision coverage ratio rose to 70%, up 330 basis points quarter on quarter, while net non-performing assets (NPAs) fell 9% to 22100 crore from a quarter ago. Provisions and contingencies fell 11% year on year and 33% quarter on quarter to 4,000 crore.

Analyst expects that profitability to improve with further moderation in credit cost, NCLT recoveries and higher loan growth. “Improving rating profile and declining stress book provide comfort on asset quality. Further resolutions in NCLT cases can provide additional surprises," HDFC Securities said in a 27 October note.

Of the analysts covering the stock, 50 have a “buy" rating, while one has a “sell" rating, according to Bloomberg data.

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