ICICI Bank Q1 Review - Results Broadly Inline With Estimates: Systematix

Systematix Research Report

ICICI Bank Ltd. reported Q1 FY25 profit after tax of Rs 110 billion (+3% QoQ, +15% YoY) which was broadly in-line with estimates (excluding one-off AIF provision reversal of Rs 3.89 billion). While net interest income was in-line, higher other income gains was offset by tad higher credit costs.

Other key highlights were:

1. Net Advances increased by 3.3% QoQ, 15.7% YoY and Growth was led by business banking (9% QoQ, 36% YoY) and SME (4% QoQ, 23% YoY). Unsecured credit (personal growth + credit cards, 14% of total loans) growth slowed down to 2.3% QoQ, 27% YoY.

2. Deposit mobilization (1% qoq, 15% YoY) was weak and was led by term deposit growth of 3% QoQ, 20% YoY. CASA ratio declining to 40.9% (-125 bps QoQ).

3. Reported NIM (4.36%) declined by -4 bps QoQ mainly due to -8bps QoQ decline in yield on advances due to interest reversal on KCC slippages and pricing competition in corporate loans.

4. The bank has an LCR of 122.7% (consolidated) as of June-24 and expects an impact of 10-15% due to implementation of new LCR guidelines,

5. Other income increased by 24% QoQ, 29% YoY led by higher treasury gains (versus loss in previous quarter) and higher dividends from subsidiaries.

6. Opex to assets increased to 2.2% versus 2.1% in Q4 FY24 led by seasonally higher employee costs due to wage hikes.

7. Gross / net slippage ratios increased to 2.01% / 0.89% versus 1.79% / 0.43% in Q4 FY24 and 2.1% / 0.71% in Q1 FY24 due to seasonal slippages in KCC portfolio.

8. The bank delivered RoA of 2.27% and RoE of 17.3% (ex AIF provision reversal of Rs 3.89 billion).

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