The private sector lender reported a healthy performance in Q4, with 17% year-on-year (YoY) growth in profit amid contained opex and provisions. The pace of NIM contraction decelerated, down 3 bps quarter-on-quarter (QoQ) at 4.4%.
Brokerages said ICICI Bank remains the preferred pick in the banking space, given its superior returns profile, top-management credibility, and strong capital/provision buffers.
Among global brokerages, CLSA raised the target price to Rs 1,350. JPMorgan, which has a target price of Rs 1,350 on ICICI Bank with an overweight rating, has upgraded F25/26 EPS estimate by 4% and said the valuations are reasonable and leave scope for upward re-rating.
Nomura has set a target price of Rs 1,335.
Emkay Global expects the bank to deliver higher RoA at 2.1-2.3%/RoE at 17-18% over FY25-26, mainly on the back of healthy margins/fees and lower LLP. The domestic brokerage has raised its target price from Rs 1,400 to Rs 1,450.Motilal Oswal has raised EPS estimates by 2% for FY26, with little change to the FY25 outlook. “We estimate RoA/RoE of 2.26%/18.0% in FY26. We expect the bank to sustain a ~14% CAGR in PAT over FY24-26E. Reiterate BUY with a revised SoTP-based target price of Rs 1,300,” it said.The bank’s management expects NIMs to remain range-bound even as they expect some deposit repricing accompanied by signs of easing competitive intensity on the lending side.”The bank has been generating RoAs higher than 2% despite margins being under pressure supported by healthy growth momentum. We believe ICICI Bank firmly remains on a path to delivering +2.3%/18.5% avg. RoA/ RoE over FY25-26E aided by asset quality being in good shape, and continued growth momentum while margins are expected to moderate slightly. ICICI bank has continued to deliver best-in-class return profile among its larger private peers which will help it retain its valuation premium,” said Sameer Bhise of JM Financial.
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