ICICI Bank Quarterly Results : Profit Jumped, Asset Quality Improved

ICICI Bank reported its Q1 earnings and earnings were above expectations. The share price of ICICI Bank was Rs 799.60 per share on Friday, before the earnings.

ICICI Bank Earnings: Key Highlights

• Net Profit: Rs 6,904.94 crore, up 49.59% year-on-year
• Net Interest Income: Rs 13,210 crore, up 20.8% year-on-year
• Net NPA: Declined to 0.70%

Below are details from its recent quarter results:

ICICI Bank Q1 Results (FY2023): Profit beats estimates

The net profit grew 49.59% year-on-year to Rs 6,904.94 crore, beating street expectations of Rs 6,790 crore. Last year, for the Apr to June quarter, the net profit reported by the bank was Rs 4,616.02 crore. ICICI bank was able to post a higher profit on the back of a healthy rise in Net Interest Income.

ICICI Bank Q1 Results (FY2023): Net Interest Income Jumped

A bank’s primary business is to get money from different sources and lend the same to other sources at a rate higher than the rate at which they borrowed. The income the bank generates from this difference is Net Interest Income.

Net interest income for ICICI Bank grew at 20.8% YoY to Rs 13,210 crore compared to Rs 10,935.76. Sequentially, the NII increased 4.8% from Rs 12,604.56 crore. The bank reported a net interest margin of 4.01% in Q1FY23 compared with 4% in Q4FY22 and 3.89% in Q1FY22. The non-interest income (excluding treasury income) reported was Rs 4,629 crore, up by 25% YoY. The Fee Income grew by 32% year on year to Rs 4,243 crore in Q1FY23 compared with Rs 3,219 crore in Q1FY22.

ICICI Bank Q1 Results (FY2023): Asset Quality Improved

The asset quality in Q1FY23 improved for ICICI bank. The net NPAs declined to 0.70% in the June quarter from 1.16% in Q1FY22 and 1.16% in Q4FY22. In the June quarter,  the gross NPA ratio declined to 3.41% from 3.60% in Q4FY22 and 5.15% as of June 30, 2021.

ICICI Bank Q1 Results (FY2023): Capital Adequacy stayed flat

Capital Adequacy Ratio (CAR) is the ratio of a bank's capital in relation to its risk-weighted assets and current liabilities. ICICI reported Capital Adequacy at 18.74% in the June quarter and Tier-1 capital adequacy at 17.95%.

ICICI Bank Q1 Results (FY2023): Provisions fell

The total provisions during the quarter were Rs 1,144 crore or about 11.1% of core operating profit and about 0.53% of average advances. This includes contingency provisions of Rs 1,050 crore made on a prudent basis. The Bank held contingency provisions of Rs 8,500 crore for Q1FY23.

ICICI Bank Q1 Results (FY2023): Loan Growth Beat Estimates

The domestic advances for the bank grew by 22% YoY and 4% QoQ for the quarter ending June. The total advances reported by the bank increased to Rs 8.95 lakh crore in Q1FY23 from Rs 8.73 lakh crore in Q1FY22. The retail loan portfolio, excluding rural loans, grew by 24% year-on-year on June 30, 2022. Including non-fund outstanding, the retail loan portfolio was 44.0% of the total portfolio in Q1FY23. The rural portfolio grew by 8% year on year. 

ICICI Bank Q1 Results (FY2023): Deposits Growth Beat Estimates

 The bank has shown exceptional numbers in terms of deposits. Total deposits rose 13% year-on-year to Rs 10.50 lakh crore. Average current account deposits increased by 23% YoY and 3% sequentially while average saving account deposits increased by 19% YoY. Period-end term deposits increased by 11% year-on-year to Rs 5.58 lakh crore in the June quarter.

ICICI Bank results: Update from subsidiaries

ICICI Prudential Life Insurance: 

Value of New Business (VNB) increased by 32% year-on-year to Rs 471 crore in Q1FY23 from Rs 1,621 crore in FY21. The annualized premium equivalent increased by 25% year-on-year to Rs 1,520 crore in Q1FY23. The profit after tax was Rs 156 crore in Q1FY23 compared to a loss of Rs 186 crore.

ICICI Lombard General Insurance: 

The Gross Direct Premium Income (GDPI) grew by 28.2% YoY to Rs 5,370 crore in Q1FY23 from Rs 4,188 crore in Q1FY22. The combined ratio was 104.1% in Q1FY23 compared to 123.5% in Q1FY22. The profit after tax of ICICI General grew by 79.6% to Rs 349 crore in the June quarter from Rs 194 crore in Q1FY22.

ICICI Securities: 

The profit after tax of ICICI Securities, on a consolidated basis, as per Ind AS, increased from Rs 305 crore in Q1FY22 to Rs 380 crore in Q1FY23.

Brokerage Radar

JM Financial has a BUY call on ICICI Bank with a target price of Rs 1010 while Axis Securities has given a target price of Rs 1000.