scorecardresearchICICI Bank Stock Check: Here's what fundamental and technical analysts say about its long-term prospects

ICICI Bank Stock Check: Here's what fundamental and technical analysts say about its long-term prospects

Updated: 12 Aug 2022, 02:22 PM IST
TL;DR.
  • ICICI Bank saw a growth of 49.59% in Q1FY23 net profit at 6,904.94 crore compared to 4,616.02 crore in the same period last year.
ICICI Bank has been outperforming the industry for two-three years.

ICICI Bank has been outperforming the industry for two-three years.

Shares of ICICI Bank rose more than a percent to hit their fresh 52-week high of 869.40 in intraday trade on BSE on August 12.

The stock has been witnessing healthy traction this year. Year-to-date, the stock is up 16% as of the August 11 close.

The lender saw a growth of 49.59% in Q1FY23 net profit at 6,904.94 crore compared to 4,616.02 crore in the same period last year.

Q1 PAT, however, declined by 1.62% from 7,018.71 crore recorded in the preceding quarter.

The bank's net interest income for the quarter under review stood at 13,210.02 crore, up 20.8% from 10,935.76 crore in the corresponding period a year ago and also increasing by 4.80% from 12,604.56 crore in Q4FY22.

Net interest margin during the quarter stood at 4.01% against 3.89% in Q1FY22 and 4% in Q4FY22.

Fundamental views

Analyst: Ajit Kabi, Banking Analyst at LKP Securities

ICICI Bank has been outperforming the industry for two-three years. The credit grew at a CAGR of more than 15%.

The credit quality has witnessed a consistent improvement with the current NNPA ratio of mere 70bps. The bank has the contingent provision of 2.1% of the loan (outside PCR), it would be adequate to protect the balance sheet with a restructuring book of 0.8% of the net loan.

The bank’s margins are also at above par level. Factoring in sound credit growth, stable margins and lower to moderate provision expenses, we believe the FY23E ROE would be 15%.

The valuations are at par and well-performing subsidiaries are likely to add value. Thus we believe, the bank has immense potential and has further room for the stock price surge.

Technical views

Analyst: Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher

ICICI Bank has given a decent rally from the 670 level and is currently trading near the 52-week high level of 869. It can witness a resistance barrier for the time being.

While the overall trend remains strong, we anticipate a further upward move if a decisive breach above the 870 level is established in the coming days and can expect a further upward move to 950-960 levels.

A small dip or consolidation phase in the stock from the current peak level cannot be ruled out which would be a healthy indication for the continuation of further rise after a higher bottom formation pattern formed on the daily chart. Our view shall be negated only after a decisive breach below the 820 level.

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ICICI Bank Technical chart

Analyst: Jigar S. Patel, Sr. Manager - Equity Research, Anand Rathi

On the daily chart, the counter is near resistance levels of approximately 860. Over the last one-and-half-month, the stock has seen a 30% appreciation. If one is already holding, then one should book some profits between 855-865 levels.

The counter recently formed Gravestone Doji Candlestick Pattern with higher volume which is a sign of weakness. Last but not the least, fresh buying in the counter is not advisable at the current market price, as daily MACD (moving average convergence and divergence) is over-stretched at higher levels which is a sign of exhaustion.

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ICICI Bank Tech chart

According to a MintGenie poll, an average of 45 analysts have a ‘strong buy’ call on the stock.

Disclaimer: The views and recommendations are those of individual analysts and not of MintGenie.

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First Published: 12 Aug 2022, 02:22 PM IST