ICICI Bank reported a strong quarter with its core income and Net profit, both seeing growth of 8.5% on a year-on-year basis, and both surpassing expectations. Asset quality improved and provisions fell sharply sequentially, contributing to the profit beat.
48 out of the 50 analysts that have coverage on ICICI Bank, have a “buy” rating on the stock, while the other two have a “hold” rating. No analyst tracking the lender has a “sell” rating on the stock.
Here are five factors why analysts tracking the lender continue to remain bullish on the stock:
| Brokerage | Target (₹) | Upside (%) |
| Citi | 1,720 | 27 |
| CLSA | 1,700 | 26 |
| Nomura | 1,620 | 20 |
| Jefferies | 1,670 | 21 |
| Kotak Instl Equities | 1,800 | 33 |
| Investec | 1,625 | 20 |
| Morgan Stanley | 1,705 | 26 |
| Bernstein | 1,550 | 15 |
| JPMorgan | 1,600 | 19 |
| UBS | 1,720 | 27 |
Positive Growth Momentum & Return Ratios
According to brokerage firm Citi, ICICI Bank saw broad-based growth momentum led by rural and business banking, with retail also stepping up.
Return on Assets for the lender at 2.4% also surpassed estimates, led by near-zero credit costs, stable margins and strong loan growth.
As a result, Citi has raised ICICI Bank’s loan growth estimates to 15% to 16%, expects margins to remain in a range, with reversal of agri-PSL provisions also offering a credit cost buffer.
Strong Asset Quality
ICICI Bank’s asset quality improved from the December quarter with Gross NPA improving to 1.4% from 1.53% in the December quarter, and Net NPA improving to 0.33% from 0.37% sequentially.
CLSA wrote in its note that Profit Before Tax for the lender grew 10% from last year due to negligible credit costs. This was due to sharp recoveries from written-off accounts.
“However, even after excluding that, core asset quality was better than estimates,” CLSA wrote in its note, adding that the current results also should put to rest the worries that ICICI Bank’s loan growth is slowing.
Core Income Growth
According to JPMorgan, ICICI Bank delivered another quarter of industry leading growth with sequential net advances growth not only bettering estimates, but also higher than larger private peers.
The brokerage expects core income (NII) growth to accelerate further to 12.3% and 15.1% in financial year 2027 and 2028 respectively.
Minimal Impact Of West Asia War
The management of ICICI Bank affirmed no concerns in its loan portfolio, particularly in business banking, due to the ongoing supply chain disruptions from the West Asia conflict, which JPMorgan believes is “comforting.”
Morgan Stanley also wrote that ICICI Bank has demonstrated resilience with growth amid geopolitical uncertainties.
Valuation Premium
According to Jefferies, ICICI Bank’s current valuations of 2.2 times financial year 2027 adjusted price-to-book is at a deserved premium to peers.
Nomura expects ICICI Bank to deliver sector-leading Return on Assets (RoA) and Return on Equity (RoE) over financial year 2027-2028.
However, Kotak Institutional Equities believes that as a sector leader, ICICI Bank has to deal with elevated expectations that are challenging to meet, and combined with its valuation premium, outperformance is difficult. The brokerage though, likes ICICI Bank’s balance sheet resilience over growth.
Shares of ICICI Bank ended at the day’s high on Friday, with gains of 0.5% at ₹1,352.8. The stock has gained 8.5% in the last one month but is still down 10% from its 52-week high of ₹1,500.
