ICICI Bank to report Q3 results on Jan 22; Here's what brokerages expect

Analysts expect ICICI Bank to continue reporting healthy operating profit, along with double digit growth in loan book

ICICI Bank Q3 preview: ICICI Bank is scheduled to report its December quarter earnings (Q3FY22) on Saturday, January 22, 2022. Analysts expect the private lender to continue reporting healthy operating profit, along with double digit growth in loan book. Net interest margin (NIM), they say, may remain stable sequentially.

That said, management commentary on future growth trends, additional utilization of contingency provisions, slippages, movement in stressed loans, and commentary on asset quality and credit costs will be tracked by the Street.

Here's what key brokerages expect:

Morgan Stanley

The brokerage expects strong loan growth at 16 per cent year-on-year (YoY), mainly led by retail and SME segments. Sequentially, it expects loan growth at 6 per cent quarter-on-quarter (QoQ).

They are building in marginal decline in NIMs at 3.96 pe cent, compared with 4 per cent last quarter. Net interest income, meanwhile, is seen growing 23 per cent YoY.

"We expect cost growth at over 23.5 per cent YoY, given increase in business volumes. Further, we expect sustained strong core operating profit growth at 21 per cent in Q3FY22, which could be one of the best amongst large banks," it said.

HSBC

The brokerage has the most optimistic forecast for net profit at Rs 6,256.5 crore, up 26.7 per cent YoY from Rs 4,939. crore in Q3FY21. Sequentially, it would be a 13.5 per cent growth from Rs 5,510.9 crore reported in Q2FY22.

Operationally, operating profit is seen at Rs 10,557 crore, up 24.3 per cent YoY (6.5 per cent QoQ) from Rs 8,491.1 crore (Rs 9,914.7 crore QoQ).

Nomura

The brokerage forecasts loan growth at 17.1 per cent YoY and 7 per cent QoQ at Rs 8.18 trillion. NII, meanwhile, is expected to grow 19.3 per cent YoY and 1.1 per cent QoQ at Rs 11,821.3 crore. Core operating profit is seen increasing 14.4 per cent YoY and 1.8 per cent QoQ at Rs 10,092.7 crore.

It forecasts slippage ratio at Rs 7,231 crore or 1.9 per cent compared to Rs 11,818 crore or 3.4 per cent in Q2FY22.

Kotak Institutional Equities

Similar to Nomura, KIE expects the lender to report 20.2 per cent YoY increase in NII at Rs 11,947 crore. The interest income was Rs 9,912.5 crore in Q3FY21 and Rs 11,689.7 crore in Q2FY21. Net profit, meanwhile, is seen at Rs 5,821.8 crore (up 17.9 per cent YoY and 5.6 per cent QoQ).

The brokerage bakes in provisions at Rs 2,442.1 crore, down around 11 per cent YoY and 10 per cent QoQ. "We expect provisions to slide down to 1.2 per cent of loans leading to lower net NPL ratios. We are building slippages of 2 per cent (Rs 4,200 crore) but we see a solid commentary on recovery to continue resulting in lower stress coming from asset quality perspective," it said.

Motilal Oswal Financial Services

The brokerage pegs loan book at Rs 8.04 trillion, up 15 per cent YoY from Rs 6.99 trillion, and 5.1 per cent QoQ from Rs 7.64 trillion.

Deposits, meanwhile, are expected to rise 17 per cent YoY at Rs 10.23 trillion. The same were Rs 8.74 trillion in Q3FY21 and Rs 9.77 trillion in Q2FY22.

In terms of asset quality, the gross NPA and net NPA ratios are seen stable at 4.8 per cent and 1 per cent. Provision coverage ratio, however, may rise marginally on a quarterly basis to 80.5 per cent from 80.3 per cent.

JM Financials

It sees net profit at Rs 6,003.1 crore, up 30.2 per cent YoY and 8.9 per cent QoQ. NII and Operating Profit are pegged at Rs 12,278.9 crore and Rs 10,455.4 crore, respectively.