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ICICI Bank slips post 8% fall in June-quarter profit

With a 13% rise over the last three months, ICICI Bank's stock has outperformed benchmark indices

SI Reporter  |  New Delhi 

ICICI Bank

fell as much as 2.9% in today’s trade after the private lender reported 8% fall in June quarter profit to Rs 2,049 crore (YoY), in line with Street expectations. The drop in profit was impacted by higher provisions and subdued growth in other income & operating income.
 
Slow growth in net interest income also hit profitability but the asset quality was stable during the quarter with sharp fall in for the quarter stood at Rs 4,975 crore, which were much lower than Rs 11,289 crore reported in Q4FY17.

 
Chanda Kochhar, MD & CEO, explained that the dip in profit was on account of the fact that exchange rate gain related to overseas operations, which was available in the year-ago quarter, was no longer permitted to be accounted for as income from the reporting quarter and ICICI Prudential Life had moved to dividend payments on half-yearly basis from quarterly basis.
 
Asset quality of the country's largest private sector lender was stable during the quarter. Gross non-performing assets increased to 7.99% from 7.89% but declined to 4.86% from 4.89% (QoQ).
 
Kochar said that the gross additions to NPAs at Rs 4,976 crore in the June quarter were the lowest in the last seven quarters, reiterating the bank's guidance that incremental bad loans in the current financial year to March will be lower than the last financial year.
 
Further, in the reporting quarter, recoveries and upgrades of Rs 2,775 crore reflected completion of the sale of cement business of a borrower, which was classified as NPA in the preceding quarter. Net addition to was at Rs 2,201 crore.
 
With a 13% rise over the last three months, ICICI Bank’s stock has outperformed benchmark indices.
 
At 9:43, the scrip was trading 1.7% lower at Rs 301.65 as against 0.5% fall in the BSE Sensex. The stock opened at Rs 303.7 and hit a high and low of Rs 304 and Rs 298 respectively till now.

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