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4QFY2012 Result Update | Banking

April 28, 2012

ICICI Bank
Performance Highlights
 
Particulars (` cr) NII Pre-prov. profit PAT
Source: Company, Angel Research

BUY
CMP Target Price
3QFY12 2,506 2,354 1,503 % chg (qoq) 8.2 14.2 15.0 4QFY11 2,312 2,343 1,437 % chg (yoy) 17.3 14.7 20.3

`869 `1,183
12 Months

4QFY12 2,712 2,687 1,728

Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code

Banking 99,858 1.3 1119/641 653,759 10 17,187 5,209 ICBK.BO ICICIBC@IN

ICICI Bank reported healthy performance for 4QFY2012. Net profit for the bank grew by 20.3% yoy to `1,728cr. Key highlights of the results were a) 33bp
sequential increase in domestic NIMs mainly driven by no securitization losses during the quarter and full impact of base rate hike and b) continued improvement in asset quality front. We maintain our Buy view on the stock. NIMs and asset quality, both improved: During the quarter, advances for the bank increased by healthy 17.3% yoy (3.1% qoq), aided by a strong 29.5% yoy (16.2% qoq) growth in SME book, 26.6% yoy growth in corporate book and 26.0% yoy growth in Overseas book (excl. positive impact of INR depreciation 10.4% yoy). Deposits accretion moderated with growth of 13.2% yoy (sequential decline of 2.0%), mainly on account of subdued current deposits growth and moderate 13.7% yoy saving deposits growth. Consequentially, CASA ratio declined 160bp yoy (10bp qoq) to 43.5%. Domestic NIMs improved by 33bp sequentially to 3.3%; while, Overseas NIMs improved by 12bp qoq to 1.5%. Non-interest income (excl. treasury) increased by only 12.7% yoy, on back of moderation in corporate fee income. Misc. other income for the bank grew to `342cr from `46cr in 4QFY2011, aided mainly by higher dividend income of ~`175cr. The bank’s asset quality improvement

Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 26.9 62.8 10.3

continued during this quarter as well, with both gross and net NPA ratio declining sequentially by 20bp and 10bp, respectively. Provision coverage ratio remained healthy at 80.4%. The bank’s restructured book grew by `1,186cr (38.6% qoq) to
`4,256cr, in line with the management guidance and primarily included accounts such as GTL and 3i Infotech. The management indicated that no major restructuring is in the pipeline. They also specified that based on their past experiences, slippages from restructured assets is ~5%. Outlook and valuation: The bank’s substantial branch expansion in the past 3-4 years is expected to sustain a far more favourable deposit mix going forward. Moreover, a lower risk balance sheet has driven down NPA provisioning costs, which we believe will enable RoE of 16% by FY2014E (with further upside from financial leverage). At the CMP, the bank’s core banking business (after adjusting for subsidiaries) is trading at 1.5x FY2014E ABV (including subsidiaries, at 1.4x FY2014E ABV). We maintain our Buy recommendation on the stock with a target price of `1,183.

Abs. (%) Sensex ICICI Bank

3m (0.3) (2.2)

1yr (10.9) (22.2)

3yr 56.2 97.8

Key financials
Y/E March (` cr) NII % chg Net profit % chg NIM (%) EPS (`) P/E (x) P/ABV (x) RoA (%) RoE (%)
Source: Company, Angel Research

FY2011 9,017 11.1 5,151 28.0 2.6 44.7 19.4 1.8 1.3 11.7

FY2012 10,734 19.0 6,465 25.5 2.7 56.0 15.5 1.7 1.4 13.5

FY2013E 13,180 22.8 7,843 21.3 2.8 67.9 12.8 1.5 1.5 14.7

FY2014E 15,462 17.3 9,369 19.5 2.8 81.1 10.7 1.4 1.5 16.0

Vaibhav Agrawal
022 – 3935 7800 Ext: 6808 vaibhav.agrawal@angelbroking.com

Varun Varma
022 – 3935 7800 Ext: 6847 varun.varma@angelbroking.com

Sourabh Taparia
022 – 3935 7800 Ext: 6872 sourabh.taparia@angelbroking.com

Please refer to important disclosures at the end of this report

1

on others Interest Expended Net Interest Income Other income Other income excl.791 (196) 46 4.346 618 1.119 3.2 3.957 1.Treasury income . treasury .8 15.2 9.8 31.333 2.510 1.on Advances / Bills .051 2.7 10.6 12.3 37.647 2. estimates Particulars (` cr) Net interest income Other income Operating income Operating expenses Pre-prov.917 837 1.8 13.348 629 1.642 741 1.701 (65) 256 4.Fee income .5 17.452 24.ICICI Bank | 4QFY2012 Result Update Exhibit 1: 4QFY2012 performance Particulars (` cr) Interest earned .8 (4.6) 1.535 2.615 128 303 6.4 8.8 5.105 2.844 2.222 1.228 2.5 20.070 1.9 31.8 15.6) 30. (%) 9.156 4.824 476 2.0 169bp 7.Other income Operating income Operating expenses .902 Estimates 2.6 19.305 384 1.642 741 1.128 2.9 3.7 9.6 (343. Angel Research Actual 3.604 1.175 6.1 35.6) 649.4 28.4 28.2 (1.719 Var.728 26.3 10.687 341 2.7 35.5) 12.921 469 1.070 3.8 5.641 1.0 22.on balance with RBI & others .8 7.3 6.2 14.7 (3. Angel Research 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy) 9.1 18.592 5.Employee expenses . profit Provisions & cont.on investments .6 23.5) (180.880 2.4 40.0 360bp Exhibit 2: 4QFY2012 – Actual vs.7 April 28. 2012 2 .9 28.080 2.0 8.103 1.8 10.6 15.222 3.112 469 2. PBT Prov.892 1.875 2.333 2.5 57.228 5.032 4.105 2.837 1.712 1.686 2.8 12.5 (5. for taxes PAT Source: Company.902 28.Other Opex Pre-provision Profit Provisions & Contingencies PBT Provision for Tax PAT Effective Tax Rate (%) Source: Company.8 37.5 17.845 857 989 2.209 91 321 4.473 134 299 5.1) 33.112 469 2.2 35.8 1.728 158 342 5.150 1.

728 246.1 (165)bp (102)bp (49)bp 27bp (281)bp (5. Retail loans grew by 7.9% yoy.7) 3.5 18.3 34. aided by a strong 29.9 34.9 13.1 19.5 12.7 80.5 10.7 44.589 99.861 0.0% and 6.1 216.7 9.7) (38)bp 439bp 2bp 111.6) (85)bp (22.2% qoq) growth in SME book.0%).878 66.7 9. 2012 3 .2% yoy (sequential decline of 2. respectively. partly due to the bank’s conscious strategy to reduce the share of unsecured personal and credit card loans.4% yoy).475 3.8 2.7% saving deposits growth.0 41.4 17.498 43.0% yoy growth in Overseas book (excl. assets (%) Source: Company. mainly on account of subdued current deposits growth and moderate 13.6% yoy (9. Rural segment loans grew at 6.2 2.5) (20)bp (9.0) 225. Muted growth in current deposits and moderate growth in saving deposits led the CASA ratio for the bank to decline 160bp yoy (10bp sequentially) to 43.500 260.9 0.537 (2.6% yoy growth in corporate book and 26.5%.046 43. Angel Research 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy) 253. 26.6 1.5 (12)bp (36)bp (45)bp 31bp 2bp (2.3 13.4 0.0 0.6 9.366 (2.3% in 4QFY2012 from 95. to avg.7 3. Personal loans came off by a sharp 57.1 2.602 484bp (12.7 41.039 73.034 4.157 255.747 Overall NIMs improve 27bp sequentially During 4QFY2012.3 13.048 0.973 76.019 113. Secured vehicle and housing advances grew by 18. April 28.4 94.723 3.5 40.8% qoq on account of year ending phenomena of higher priority sector lending in the last quarter).3% yoy (3.7% as of 4QFY2011 (33.5% in 3QFY2012.3 340bp 0.5 13.ICICI Bank | 4QFY2012 Result Update Exhibit 3: 4QFY2012 performance analysis Particulars Balance sheet Advances (` cr) Deposits (` cr) Credit-to-Deposit Ratio (%) Current deposits (` cr) Saving deposits (` cr) CASA deposits (` cr) CASA ratio (%) CAR (%) Tier 1 CAR (%) Profitability Ratios (%) Reported NIM Cost-to-income ratio Asset quality Gross NPAs (` cr) Gross NPAs (%) Net NPAs (` cr) Net NPAs (%) Provision Coverage Ratio (%) Provision exps.5% in 3QFY2012). the growth in international advances would have been much lower at 10.4% yoy (27. Consequently.1% qoq).1) (10)bp 150bp 10bp 95.9% in 4QFY2011 and 94.2) 101. Deposits accretion moderated during the quarter with growth of 13.2% qoq).5% yoy (16. credit to deposit ratio for the bank rose sharply to 99. while credit card debt declined by 8.7% yoy.7% yoy. the positive impact of INR’s depreciation.869 45.5% as of 4QFY2012 as against 38.1 76.6 18.8 78. advances for the bank increased by healthy 17.407 1. the retail segment’s overall contribution to the advances book came at 35.3 3.5 2. Consequentially.

7) (8.062 253.0 14.3%.342 2.6 2.0) 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.6 15.4 23.734 53.0 5. Exhibit 4: Consolidation in unsecured retail advances continue Particulars (` cr) Rural Overseas Corporate SME Retail .345 2. on account of improvement in both domestic and international NIMs.986 11. They anticipate the bank’s consolidation in overseas loan book to continue in current year as well.2 5.173 46.3 19.2) 16.4 26. overall NIMs are expected to improve by 10-15bp in FY2013 as compared to FY2012.Housing .157 13.3 8.1 41.1 Dep.0 (57.0 (3.52% mainly on account of higher yield on advances.463 54.755 22. qoq growth 9.448 90.987 55.0 15.8 18. Management expects the banks’ domestic loan book to grow by ~20% in FY2013 mainly driven by corporate and secured retail loans.572 991 2.2 9.0 96 96 95 94 35. 2012 4 .5 45.0 10.0 26.1 216.ICICI Bank | 4QFY2012 Result Update Reported overall NIM improved by 27bp sequentially to 3.9 42. Angel Research Exhibit 6: CASA ratio remain flat sequentially CASA ratio (%) 45.328 69.8 (0.6 17.0 3.3 35.9 100. RHS) 99 110 100 90 80 70 60 25.524 2.0 6. Domestic NIMs improved by 33bp qoq to 3. aided by higher investment income on account of no securitization loss during the quarter and higher yield on advances on account of full impact of base rate hike.8 0.763 6. while 1QFY2013 NIMs are likely to be sequentially lower due to priority sector lending.5 22.663 64.Other retail Total Advances 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy) % to total 22. Adv.0 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.0 CASA yoy growth (%) 25.9 18.0 2.086 10. Overseas NIM improved by 12bp qoq to 1.7) 7.474 27.01%.6 29. Angel Research 43.0 43.521 58.Personal .0 0.073 57.357 13.522 17.5 0. qoq growth CDR (%.924 22.0 20.366 Source: Company.4 1.1 5.9 20.0 20.1 1.477 69.728 246.182 990 2.177 3.Credit cards .5 7.6 6. Going ahead.7 10.8 27.386 83.0 5. Angel Research Exhibit 5: CDR picks due to moderation in deposits gr.647 26.569 82.2) (10.2 9.0 - April 28. According to the management.1 5.Vehicle .

the management expects fee income growth to be in low double digits in FY2013. Going ahead.0 10.1 17.3 13. non interest income excl.7 2.300 2. Exhibit 9: Other Income aided by dividends from subsidiaries Particulars (` cr) Fee income Treasury Others Other income Other income excl.0 20.1) 33. Other income for the bank grew to `342cr from `46cr in 4QFY2011.200 3.7 25. Treasury income came in at `158cr as against loss of `196cr in 4QFY2011.728 158 342 2.0 5.450 2. on back of moderation in fee income.892 1.0 15.0 2.070cr. Angel Research Fee income moderation continues During 4QFY2012. despite MTM losses on security receipts.8 4QFY11 1.070 1.6 17.900 2.0 3. on account of higher proprietary trading income and improved performance on equity portfolio. Angel Research 4QFY12 3QFY12 1.641 1.ICICI Bank | 4QFY2012 Result Update Exhibit 7: NIMs improve sharply by 27bp qoq NIM (Reported. 2012 5 .5) (180.957 % chg (qoq) 1.0 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company. Angel Research Source: Company.6 (343.6) 648.6 2.750 2.7 Exhibit 8: NII growth trends NII (` cr) 3. on account of.9 35. treasury Source: Company.7 April 28. RHS) 23.600 2. treasury for the bank increased by 12. continued traction anticipated in transaction banking and remittance business.791 (196) 46 1.7% yoy to `2.7 YoY growth (%. %) 3. Fee income declined by 3.6 2.6 2. mainly aided by dividend income of `100cr received from ICICI Bank UK and ~`75cr from its life insurance subsidiary.8 5.8 2. while stabilization expected in corporate fee income.701 (65) 256 1.228 2.3 21.5% yoy due to moderation in corporate fee income despite traction witnessed in income from transaction banking and remittance segments.4 2.837 % chg (yoy) (3.2 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 2.8 12.000 23.150 2.050 2.

500 1.8 1.186cr (38.500 3.0) 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.6% qoq) to `4.9 Net NPAs (%) Coverage ratio (%.7% in 3QFY2012. the operating expenses to average assets ratio increased to 1. slippages from restructured assets is ~5%. Consequently. The management indicated that no major restructuring is in the pipeline.0 4.0 60.0 1.4 1.250 1.0 75.900 1.000 2. Further they guided for credit cost to be 75bp for FY2013.0 5.0 10.070 4.6% (3. primarily due to increase of `267cr in employee expenses on the back of higher bonus provisions.9 4.8% in 4QFY2011 and 1. RHS) 80.0% qoq). while net NPA ratio stands at 0.2 78.256 Exhibit 13: Declining NPAs with improving coverage Gross NPAs (%) 5.700 1.ICICI Bank | 4QFY2012 Result Update Exhibit 10: Fee income moderation continues 1.791 1.4 1.5 1. The management expects to contain cost-to-income ratio below 42% in FY2013. As of 4QFY2012 gross NPA ratio stands at 3. Angel Research Source: Company.578 1.0 65. RHS) 1.0 4.500 750 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 1.0 4.256cr.8 1.4 85.1 0.8 11.5 1. Angel Research Asset quality continues to improve The bank’s asset quality improvement continued during 4QFY2012 as well.9 3.5% yoy (16. They also specified that based on their past experiences.800 1.970 1.5 1.1 4.5 Fee income to average assets (%) yoy growth (%.36%.0 76. April 28.600 Fee Income (` cr) 17.6 0.0 3.700 1.2 1.7 4QFY12 1. Angel Research Source: Company.501 3. Gross slippages ratio for FY2012 stood at 1.0 2.9% in 4QFY2012 compared to 1.7%. 2012 6 .8% in 3QFY2012).750 3.0 1QFY12 2QFY12 3QFY12 Source: Company. the bank’s restructured book grew by `1.0 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 1.0 80.7 (3.7 6. in line with the management guidance and primarily included accounts such as GTL and 3i Infotech.7% (0.6 1. with both gross and net NPA ratio declining sequentially by 20bp and 10bp.728 (5.0 70.0 2.4%.0 15.966 2. respectively.6 1.400 1.0 76.9 78.8% in 3QFY2012).701 1.0) (10. Angel Research Operating costs rise due to higher employee bonus provisions Operating expenses increased by 20. Provision coverage ratio for the quarter remained healthy at 80.8 4QFY11 3. During the quarter. Exhibit 12: Restructured loans rise during 4QFY2012 (` cr) 4.5) Exhibit 11: Still healthy share of fee income in RoA 20. Cost-to-income ratio also inched up sequentially by 10bp to 41.8 0.

6 733 1.9 44.250 1.5 1. Going forward.0 10. as reflected in the falling CASA deposits/branch of ~`40cr compared to `65cr as of 3QFY2008 and the total assets/branch of `172cr compared to `394cr as of 3QFY2008.8 1. Exhibit 16: Robust branch expansion 2. 2012 3QFY08 4QFY08 1QFY09 2QFY09 3QFY09 4QFY09 1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 1.0 Exhibit 15: Opex to avg assets ratio increase in 4QFY12 Cost-to-income ratio (%) 50. Angel Research Under-leveraged branch network The number of branches for the bank has almost doubled over the past three years.500 843 837 1.5 44.080 1.9 1. Angel Research April 28. we expect the bank to leverage this network to grow its CASA market share. ICICI Bank Canada and ICICI Bank UK) continue to remain a drag on the consolidated RoE’s.4% yoy to `7.6% in FY2011.0 1.7 1. Angel Research 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.ICICI Bank | 4QFY2012 Result Update Exhibit 14: Staff expenses increased Total Opex Other opex (` cr) 2.000 857 1.308 1. management plans to maintain the branch addition rate in the range of 200-300 in coming year as well.9 2.0 1.8 1.103 2.8 1.000 1. RHS) 1. as both remain over capitalized.050 1. consolidated net profit would have grown by 33. Consolidated reported RoE’s for FY2012 improved to 13.0 1.119 44.6 989 500 - 41. reflecting bank’s strategy of consolidating their 7 . Further.087 1.7 35.438 1. Branch network improvement was partly aided by the merger with the Bank of Rajasthan.700 Exhibit 17: Under-leveraged branch network Total Assets/Branch (` cr) CASA Deposits/Branch (` cr.0 30. overseas subsidiaries of the bank (viz. Angel Research 70 60 50 40 30 20 10 - Source: Company.6% to `8.500 Staff exps Opex yoy growth (RHS) (%) 30. However.529 2.800 1. RHS) 2.0 40.752 450 360 270 180 90 3QFY08 4QFY08 1QFY09 2QFY09 3QFY09 4QFY09 1QFY10 2QFY10 3QFY10 4QFY10 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.6 41. This extensive pan India network of 2752 branches as of 4QFY2012 is under-leveraged.7 Opex to avg assets (%.0 1.741 Overview of performance of subsidiaries Consolidated net profit for FY2012 rose by a healthy 25.0% from 11.643cr (ex ICICI General additional third party motor pool losses.0 20.146cr).8 45.4 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 Source: Company.350 900 450 - 2.

6 (31.3 21.2 11. The bank received ~`100cr as dividend from its UK subsidiary in 4QFY2012 and similar discussions are in progress with the Canadian regulator. respectively.6 (21.2%.384 5.384cr for FY2012 (growth of 72. respectively.1) 22.4 233 3. ICICI Prudential Life reported PAT of `1.975 713 17.771 1.4 34. ICICI securities PD and ICICI AMC reported PAT growth of 62.6) (29. loss after tax of `80cr in FY2011) after recognizing additional third party motor pool losses of `685cr.4 4.3 (8.408 (80) 113 53 74 72 % chg (30.2 Gross Premium (` cr) PAT (` cr) PAT (` cr) PAT (` cr) PAT (` cr) PAT (` cr) April 28.0 70. While ICICI securities and ICICI ventures reported PAT de-growth of 31.4% yoy) and maintained its leadership position with a market share based on retail weighted received premium of 5. 2012 8 .9) 62.6) 3. Angel Research FY2012 25.6mn in FY2011).9%.358 (416) 77 86 68 88 FY2011 36.118 500 16.9 68.6) 6. ICICI Lombard General Insurance reported loss after tax of `416cr for FY2012 (vs.4mn in FY2012 vs.1%.3% and 22.150 808 4.ICICI Bank | 4QFY2012 Result Update operations (CAR in excess of 31% in both). In the short term. we expect the over-capitalized subsidiaries to drag the consolidated RoEs. Exhibit 18: Performance of subsidiaries Subsidiary ICICI Bank UK ICICI Bank Canada ICICI Bank Eurasia ICICI Home Finance ICICI Prudential Life Insurance Parameter PAT (USD mn) PAT (CAD mn) PAT (USD mn) PAT (` cr) APE (` cr) NBP (` cr) NBP margin (%) AuM (` cr) PAT (` cr) ICICI Lombard Gen. despite some more impact of third party motor pool liabilities on account of actuarial valuation anticipated in FY2013.9% and 8. FY2012 performance for other smaller subsidiaries was mixed. Insurance ICICI Securities ICICI Securities PD ICICI Venture ICICI Prudential AMC Source: Company. and profitability continue to decline for ICICI Bank UK (US$ 25. Management expects the company to turn profitable in FY2013.3 260 3.6 32.8 71.9) (10. US$ 36.

7%) have positioned it to gain both CASA and credit market share. Moreover. the bank has largely exited unattractive business segments such as small-ticket personal loans in the domestic segment and most non-India related exposures in its international business. the bank’s core banking business (after adjusting `134/share towards value of the subsidiaries) is trading at 1.5% CASA ratio. At the CMP. a lower risk balance sheet has driven down NPA provisioning costs.5% (Tier-I at 12. During FY2011.256cr. Improved deposit mix to lead to better NIM The bank’s strategic transformation has expectedly resulted in significantly better balance sheet and earnings quality. 2012 9 .0% in FY2010 to 1. Though the bank’s restructured loans increased by 38.4% in 4QFY2012. given its market-leading businesses across the financial services spectrum. Moreover. and strong capital adequacy. The distinguishing feature of the bank’s performance in FY2010 was the improvement in CASA ratio to 42. which we believe will drive 21. which has resulted in an improved deposit and loan mix and should drive improved operating metrics over the medium term. the management indicated that no major restructuring is in the pipeline. April 28. Apart from the paradigm shift in the deposit mix reflected in its 43. For FY2012 gross slippages ratio stood at comfortable ~1. Valuations attractive We have a positive view on ICICI Bank.36%. the bank’s substantial branch expansion from 955 branches at the end of 3QFY2008 to 2. the bank has maintained a comfortable provision coverage ratio of 80. the bank improved its market share of savings deposits by 10bp over FY2010.1% (transformative considering that the ratio was as low as 22% at the end of FY2007 and 29% even as recently as FY2009).752 branches by 4QFY2012. The reduction in risk profile of advances has expectedly resulted in commensurate decline in NPA provisioning costs and reflected in improved RoA from 1. respectively. slippages from restructured assets is ~5%. CASA ratio has remained healthy at 43. The bank’s substantial branch expansion in the past 3-4 years is expected to sustain a far more favourable deposit mix going forward.5% even in 4QFY2012. In fact. Management also specified that based on their past experiences.4% in FY2012. with a declining trend in additions to gross as well as net NPAs. capturing a substantial 5.8% incremental market share.5x FY2014E ABV (including subsidiaries. Asset quality trends remain healthy The bank’s asset quality continues to show further improvement. at 18. the bank has once again started gaining market share in savings accounts since FY2010.ICICI Bank | 4QFY2012 Result Update Investment arguments Well positioned to garner strong market share gains in CASA deposits In our view.3% yoy growth in net profit for FY2013E and enable RoE of 16.6% qoq during the quarter to `4. we believe the bank is decisively executing a strategy of consolidation.0% by FY2014E (with further upside from financial leverage). Also.

0 22.168 7.369 (1.238 9.418 9.0 Exhibit 21: Change in estimates FY2013 Particulars (` cr) NII Non-interest income Operating income Operating expenses Pre-prov.3 4.0 1.2 3.782 11.0 1.0 23.935 1.7 4.153 3.183.7 22. profit Provisions & cont.8 0.1x FY2014E ABV).609 9. (%) estimates 15.701 10.8 22.0 4.ICICI Bank | 4QFY2012 Result Update the stock is trading at 1. PBT Prov.5x FY2014E NBP 12x FY2012 PAT Value/share (`) 1.8 22.311 7.183 Exhibit 20: Key assumptions Particulars (%) Credit growth Deposit growth CASA ratio NIMs Other income growth Growth in staff expenses Growth in other expenses Slippages Treasury gain/(loss) (% of investments) Source: Angel Research Earlier estimates FY2013 21.0 42.8 22.105 11.6 0.8 4. 2012 10 .691 3.397 1.941 11.5 11.8) 2.049 60 12 62 1.164 26. We maintain our Buy rating on the stock with a target price of `1.0 1.0 FY2014 23.4 4.607 4.0 19.191 21.862 1.393 1.1x FY2014E ABV 15. Securities Securities PD and Overseas subsidiaries) SOTP value Source: Angel Research Target multiple 2.274 12.209 9.0 Revised estimates FY2013 18. Exhibit 19: SOTP valuation summary Particulars ICICI Bank Life Insurance General Insurance Others (Home Fin.0 2.051 26. We value the bank’s subsidiaries at `134/share and the core bank at `1.0 43.4x FY2014E ABV).0 FY2014 22.085 4.0 20.049/share (2.0) 1.4 20.216 12.1) 3.1 9. AMC.9 April 28. (%) estimates 13.8 20.180 6.0 44.0 1.5 80.843 (1.0 22.6 4.5 4.0 44.462 3.244 14.790 13.524 Revised Var.6 21.0 15.115 15.6 75.7 78.2 Earlier estimates 14.0 18.9 2.0 22. VC.3 2.512 11.016 FY2014 Revised Var.029 22. for taxes PAT Source: Angel Research Earlier estimates 12.5 2.7 75.6 26.069 9.777 13.6 (1.

9 Var.1 5. 2012 Apr-02 Sep-02 Feb-03 Jul-03 Dec-03 May-04 Oct-04 Mar-05 Aug-05 Jan-06 Jun-06 Nov-06 Apr-07 Sep-07 Feb-08 Jul-08 Dec-08 May-09 Oct-09 Mar-10 Aug-10 Jan-11 Jun-11 Nov-11 Apr-12 Sep-12 Feb-13 7x 17x 27x 37x 11 .9 81.6 76.800 2.1 Bloomberg consensus 64.5x 2x 2.200 800 400 0 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Apr-05 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Aug-05 Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11 Apr-12 Source: Company. Angel Research Exhibit 23: P/ABV band Price (`) 2. Angel Research Exhibit 24: P/E band Price (`) 2. (%) 5.200 1.600 1.400 1.000 1.000 800 600 400 200 1x 1. consensus Year (`) FY2013E FY2014E Angel forecast 67.000 1. Angel Research April 28.ICICI Bank | 4QFY2012 Result Update Exhibit 22: Angel EPS forecast vs.800 1.5x 3x Source: Company.600 1.5 Source: Bloomberg.400 2.

7 6.0 4.3 14.0 3.7 2.3 0.9 0.8 16.1 17.5 16.8 0.6 0.9 8.7 0.7 27.9 14.7 5.1) 6.8 0.7 0.1 1.4 6.5 0.1 2.9 1.0 8.6 0.4 16.131 101 76 219 65 57 Tgt.3 1.3 24.8 1.8 0. Historical Premium Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11 Dec-11 Apr-06 Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Source: Bloomberg.5 4.9 0.2 FY2014E RoA (%) 1.0 1.1 34.6 4.5 0.8 18.7 22.6 15.1 0.2 0.3 1.8 17.0 3.3 5.0 0.5 19.7 0.4 14.8 1.1 16.4 4.2 17.7 1.0 1.138 2.587 1.4 16.7 0.0 27.2 4.9 FY2014E P/ABV (x) 1.2 3.6 0.0 23. price (`) 1.7 0.9 18.5 FY2014E RoE (%) 20.7 13.5 (2.8 0.1 7.7 0.9 0.0 20.8 1.5 22.8 23. 2012 Apr-12 12 .7 1. Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries).3 15.4 1.2 16.593 128 266 87 Upside (%) 41.2 16. Without adjusting for SASF April 28.7 0.4 29.0 17.8 0.5 1.9 0.6 23.3 26.7 FY2014E P/E (x) 8.2 21.3 17.7 4.7 3.1 8.6 21.9 21.2 21.5 1.121 417 543 869 24 350 165 115 764 337 51 430 95 410 91 101 213 87 895 242 839 2.0 1.6 8.6 36.9 8.2 Source: Company.2 13.9 1.4 4.5 33.8 0.6 0.5 0.8 0.8 0.7 0.2 11.5 0.4 1.7 23.0 4.5 12.1 1.6 13.6 23.7 26.5 17.8 19.6 0.2 12.8 0.2 22.0 13.9 3.4 13.ICICI Bank | 4QFY2012 Result Update Exhibit 25: ICICI Bank – Premium/Discount to the Sensex (%) 100 80 60 40 20 0 (20) (40) Premium/Discount to Sensex Avg.0 4.8 3.7 7.7 0.8 0.7 19. Angel Research Exhibit 26: Recommendation summary Company AxisBk FedBk HDFCBk ICICIBk* SIB YesBk AllBk AndhBk BOB BOI BOM CanBk CentBk CorpBk DenaBk IDBI# IndBk IOB J&KBk OBC PNB SBI* SynBk UcoBk UnionBk UtdBk VijBk Reco.1 1.5 6.7 0.3 10.8 0.7 0.9 45.0 16.183 470 205 125 943 392 62 532 508 118 117 240 104 296 1.7 7.9 0.7 0.8 4.8 0.7 FY2014E Tgt P/ABV (x) 2.0 5.9 29. Angel Research.8 0.0 0.9 1.9 # FY2012-14E EPS CAGR (%) 16.2 1. Buy Neutral Neutral Buy Neutral Buy Buy Accumulate Buy Buy Buy Buy Neutral Buy Buy Buy Accumulate Buy Neutral Buy Buy Buy Buy Neutral Buy Buy Neutral CMP (`) 1.0 4.5 0.8 0.6 0.9 0.1 4.6 4.1 1.8 10.4 3.8 22.9 0.7 35.4 0.6 18.6 1.2 16.6 0.4 0.

342 11.025 17.5 FY13E 13.7 7.2) 7.YoY Growth (%) Pre .4 26.800 25.7 4.359 120.301 17.206 (17.783 (12.113 350 48.238 31.5 6.027 49.6) 5.967 15.782 (5.400 27.468 15.439 21.311 29.9) 15.2) 3.3 FY13E 1.830 10.348 (10.6) 9.962 299.237 16.311 (3.045 19.615 19.164 22.YoY Growth (%) Operating Expenses .648 (11.588 544.893 181.4 7.048 (7.369 19.YoY Growth (%) Profit Before Tax .686 216.0 FY12 10.3) FY10 1.114 (10.347 406.577 473.500 13.790 0.957 26.8 9.Growth (%) Borrowings Tier 2 Capital Other Liab.359 28.0) 5.400 (4.647 20.647 17.3 2.0) 3.734 19.0) 4.9 9.987 406.850 18.155 350 69.3) 16.5 11.YoY Growth (%) Prov.399 18.1 5.029 20.3 4.0 7.017 11.502 1.338 26.732 (1.155 350 63.468 18.8) 6.048 30.501 363.215 363.0 4.3 90.907 13.7 72.9 7.465 25.947 32.503 202.617 12.ICICI Bank | 4QFY2012 Result Update Income statement Y/E March (` cr) Net Interest Income .758 26.607 22. .010 373.3 22.0 103.241 18.4 4.430 103.7 1.YoY Growth (%) FY09 9.478 (3.0) 2. 2012 13 .1 9.189 180.813 36.3 11.935 24.802 24. & Cont.428 645.4 11.234 20.301 (6.728 17.164 379.051 22.274 18.560 253.8) 7.9) 8.583 (30.3 FY14E 15.5 1.0 123.241 22.462 17.391 15.744 16.465 1.6 FY11 9.250 255.4) 1.324 25.665 0.602 11.153 26.YoY Growth (%) Operating Income .505 1.Growth (%) FY09 1.213 19.851 50.092 10.8 9.975 23.243 18.387 14.045 (13.423 (17.522 51.YoY Growth (%) Prov.420 218.Preference Reserve & Surplus Deposits .265 379.514 11.635 200.8 15.803 30.843 21.7) FY10 8.260 23.5) 60.YoY Growth (%) Other Income .9 18.505 1.505 1. & Prov.768 159.9 April 28.463 1.515 473.115 19.788 17.536 12.115 350 50.4 4.Equity .4 FY14E 1.512 19.173 368.695 304. for Taxation .6 10. Total Liabilities Cash Balances Bank Balances Investments Advances .180 22.482 18.461 15.776 645.592 (7.1) 15.4) FY11 1.5 Balance sheet Y/E March (` cr) Share Capital .366 19.058 218.1 6.0 5.8 5.317 24.5 13.Growth (%) Fixed Assets Other Assets Total Assets .151 28.7 3.390 (13.209 21.Provision Profit .860 (16.0 5.503 12.234 12.1 12.875 (1.290 (47.6 6.0 1.7) 67.939 225.183 134.1 FY12 1.512 544.8 1.782 12.5 1.397 19.017 (7.as a % of PBT PAT .152 350 53.155 350 59.606 23.4 3.8) 9.784 20.

1 449.3 0.4 1.9 18.5 0.7 2.2 0.7 1.4 1.7 4.5 1.7 43.8 11.0 1.5 13.1 30.3 75.0 15.9 10.5 1.7 2.3 2.1 9.2 59.7 0.4 2.7 19.8 41.4 2.1 0.7 100.Tier I Asset Quality (%) Gross NPAs Net NPAs Slippages Loan Loss Prov.1 607.8 4.0 9.8 (0. Op.4 0.3 1.2 12.6 1.8 2.4 1.2 1.2 1.5 22.5 1.5 0.5 9.7 0.7 2.5 81.0 9.5 67.0) 2.5 1.4 1.4 0.2 2.5 1.0 3.0 36.3 0.7 2.8 1.8 41.5 1.5 14.5 1.7 478.1 12.6 16.1 2.9 1.8 1.8 1.4 9.8 1.3 2.7 425. Sens.9 9.0 52.4 19.7 2.5 16.5 98.2 0.5 19.5 4.3 18.7 2.5 11.1 95.0 45.3 42. Exp.7 11.2 1.6 1.2 1.1 2.5 76.5 2.0 1.8 3.7 0.3 80.1 1.) DPS Valuation Ratios PER (x) P/ABVPS (x) Dividend Yield DuPont Analysis NII (-) Prov.8 41.5 10.7 1.5 2.4 1.3 2.9 19.4 3.0 2.1 1.6 41.0 1.7 3.3 80.8 1.0 56.4 0. Inc.6 10.4 27.6 3.9 1.4 0.3 1.3 0. Opex PBT Taxes RoA Leverage RoE 2.2 1.0 3.1 1.1 1. NII Treasury Int.0 28.3 2.6 1.0 1.1 (0.2 11.0 0.5 13.6 15.5 9.7 1.7 0. 2012 14 . Inc.7 2.1 1.6 0.4 14.6 42.6 0.9 561.2 1.1) 1.3 9. Assets Provision Coverage Per Share Data (`) EPS ABVPS (75% cover.7 1.0 28.4 3.4 22.8 1.5 0.9 98.0 FY09 FY10 FY11 FY12 FY13E FY14E April 28.7 0.0 2.ICICI Bank | 4QFY2012 Result Update Ratio analysis Y/E March Profitability ratios (%) NIMs Cost to Income Ratio RoA RoE B/S ratios (%) CASA Ratio Credit/Deposit Ratio CAR .9 14.3 1.0 0.8 5. Other Inc.2 43.8 12.7 43.9 1.3 11.4 13.3 24.0 522.5 99.9 2.0 44.2 2.9 2.0 4.4 37.5 2.8 1. Adj.7 89.3 14.7 3.5 12. /Avg.0 1.7 1.

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