ICICI Bank gains post Q2 results

ICICI Bank was up 3% to Rs 287 on BSE in early morning trade after the banks’ outstanding watch list for the quarter ended September 30, 2016 (Q2FY17) stood at Rs 32,490 crore down from Rs 44,000 crore at the start of the financial year.

“The bank expects repayments from the proceeds of two large asset sales (Jaiprakash group’s sale of cement plants and Essar group’s sale of oil refinery to Rosneft) to bring down the size of the watch list in six to nine months”, Chanda Kochhar, managing director and chief executive said.

ICICI Bank posted 2.37% year on year rise in net profit at Rs 3,102 crore in Q2FY17, a higher than an average analysts estimate of Rs 2,416 crore.

The non-interest income, mostly comprising gains from selling share of life insurance subsidiary through public offer, contributed to the net profit. Its non-interest income covering sale of shares and investments, fees and commissions grew three-fold to Rs 9,120 crore.

The net interest income was flat Rs 5,253 crore in the quarter under review against Rs 5,251 crore in Q2FY16.

The bank’s gross non-performing assets (GNPAs) as percentage of total assets stood at 6.82% up from 3.77% in previous year quarter.

Analysts at Elara Securities upgrade stock rating to ‘buy’ from ‘accumulate’ with a revised price target of Rs 374 from Rs 299.

“After factoring in a likely challenging year ahead amid elevated delinquencies and sustained credit cost pressures affecting bottom line, we believe the bank has sufficient capital to absorb near term asset quality shocks and relatively better positioned for sustainable business growth. In our view, likely asset quality stress and lower RoEs are partially factored in valuations,” the brokerage firm said in a report dated November 8, 2016.

At 10:10 am, the stock was up 2.4% at Rs 285 on BSE, as compared to 0.09% rise in the S&P BSE Sensex. A combined 10.65 million shares changed hands on the counter on BSE and NSE.

ICICI Bank