Shares of India’s largest private sector lender ICICI Bank rallied in trade on Thursday, after the indictment of former boss Chanda Kochhar in Videocon loan case. ICICI Bank shares gained more than 2.5% to Rs 373.50 on NSE this morning. Justice Srikrishna panel, set up to independently enquire the allegations of quid pro quo in the controversial Videocon loan case indicted Chanda Kochhar, the former CEO and MD of ICICI Bank.
The bank has said that the independent enquiry has found the former top boss in violation of code of conduct. Moreover, the bank’s board of directors has decided to treat her resignation as ‘Termination for Cause’ and require the “clawback of all bonuses paid from April 2009 until March 2018”. The bank also said that it will take further actions if “warranted” in the matter. Chanda Kochhar stepped down as bank’s MD and CEO on October 4, 2018, nearly four months after of being sent on leave.
In the latest quarter, while the firm has reported a 2.7% on-year fall in net profit to Rs 1,604.90 crore, the firm’s slippages came in at a 14-quarter low, and net interest margins improved to its best in seven quarters. Taking stock of the reported results, Axis Capital said that Q3 results indicate that the financial performance are showing signs of stabilisation. The current valuation offers decent risk-reward.
The domestic book share gain should help achieve 15% ROE in next two years. Axis Capital has a share price target of Rs 500 on the stock. The research firm’s target price implies an upside of more than 34% from the current share price. Macquarie noted that the asset quality performance has been strong, and other operational parameters have been stable. Macquarie has a share price target of Rs 460 on ICICI Bank shares, and maintained an outperform rating.
The gross non performing assets (NPAs) of the bank reduced by 5.3% (QoQ) to Rs 51,591.5 crore from Rs 54,489 crore. Similarly, net NPA reduced by 26.4% (QoQ) from Rs 22,085.7 crore to Rs 16,252.4 crore. The provisions and contingencies surged 18.89% to Rs 4,244.15 crore during the quarter under review against Rs 3,569.56 crore in the corresponding quarter last year. CASA deposits rose 15 per cent YoY to Rs 2,99,374 crore at December 31.
The provisions and contingencies surged 18.89% to Rs 4,244.15 crore during the quarter under review against Rs 3,569.56 crore in the corresponding quarter last year. CASA deposits rose 15% on-year to Rs 2,99,374 crore at December 31. The operating profit of ICICI Bank rose to Rs 6,146.42 crore in quarter ending December as against Rs 5,057.75 crore in December quarter of FY18.
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