ICICI Bank Q1FY25 preview: Profit may rise 10-12% YoY; NIM, provisions eyed

ICICI Bank Q1 2024 results preview: Analysts cautioned that ICICI Bank may face margin pressure higher than industry average on high credit costs

ICICI Bank Q1FY25 results preview: ICICI Bank may see a net profit growth on 10-12 per cent year-on-year (Y-o-Y) in the April-June quarter (Q1) of the current financial year (FY25), according to analysts.

This, they said, would imply a growth of up to 1.6 per cent quarter-on-quarter (Q-o-Q) to Rs 10,875.7 crore. ICICI Bank is scheduled to report its Q1FY25 results on Saturday, July 27, 2024.

Operationally, analysts cautioned that ICICI Bank may face margin pressure higher than industry average on high credit costs.

Here is a look at what key brokerages expect from ICICI Bank Q1FY25 results 2024:

Nomura

The global brokerage expects ICICI Bank to report unchanged core operating profit and net profit, on a Q-o-Q basis, in the quarter under review.

 

They peg core pre-provision operating profit (Core PPoP) at Rs 15,280 crore, up 10 per cent Y-o-Y from Rs 13,890 crore seen in Q1FY24 and unchanged from Rs 15,320-crore profit in Q4FY24.

Net profit, on the other hand, is seen at Rs 10,680 crore in Q1FY25, up 11 per cent Y-o-Y from Rs 9,650 crore in Q1FY24 and unchanged from Rs 10,710 crore in Q4FY24.

Nomura said the unchanged PPoP and net profit is due to a sharp rise in provisions sequentially. Nomura estimates provisions at Rs 1,290 crore, up 79 per cent Q-o-Q, but flat Y-o-Y.

Further, the brokerage sees ICICI Bank's credit cost rising 19bps Q-o-Q to 0.5 per cent from 0.3 per cent in Q4FY24. It also sees ICICI Bank's return on assets (RoA) dipping 10 bps to 2.2 per cent from 2.3 per cent Q-o-Q and 15 bps from 2.4 per cent Y-o-Y.

BNP Paribas

BNP Paribas expects ICICI Bank to report net profit of Rs 10,802.2 crore in Q1FY25, up less than 1 per cent Q-o-Q and 12 per cent Y-o-Y.

PPoP, meanwhile, is seen rising 2 per cent Q-o-Q and 8.5 per cent Y-o-Y to Rs 15,342.3 crore. This compares with PPoP of Rs 15,038.8 crore in Q4FY24 and Rs 14,139.1 crore in Q1FY24.

BNP Paribas, further, expects ICICI Bank's NII to rise 2.5 per cent Q-o-Q to Rs 19,572 crore from Rs 19,093 crore seen in Q4FY24. On a yearly basis, this would be 7.4 per cent higher than NII of Rs 18,226.5 crore reported in Q1FY24.

Motilal Oswal Financial Services

Motilal Oswal Financial Services expects ICICI Bank's asset quality to deteriorate marginally in Q1FY25 at gross loan level. It pegs ICICI Bank's gross non-performing assets (GNPA) ratio at 2.3 per cent, slightly higher than 2.2 per cent of Q4FY24.

NNPA, however, is seen flat at 0.4 per cent in Q1FY25.

ICICI Bank's loan book in Q1FY25, MOFSL said, may stand at Rs 12.25 trillion, up 16 per cent Y-o-Y. Deposits, on the other hand, may grow around 18 per cent Y-o-Y to Rs 14.59 trillion.

"We expect loan growth to remain healthy, led by Retail and SME segments. Margins, however, are expected to moderate slightly. Asset quality will be the key monitorable," the brokerage said.

Axis Securities

Providing one of the most conservative estimates, Axis Securities pegs ICICI Bank's Q1FY25 net profit at Rs 10,347 crore, up 7.2 per cent Y-o-Y but down 3.4 per cent Q-o-Q.

This, the brokerage said, is on the back of 109 per cent Q-o-Q surge in provisions at Rs 1,500 crore from Rs 718 crore. On a Y-o-Y basis, provisions could rise 16 per cent from Rs 1,292 crore seen in Q1FY24.

NII, meanwhile, may increase just 2 per cent Q-o-Q and 6.8 per cent Y-o-Y to Rs 19,473 crore in Q1FY25.

"Growth in advances is expected to be at 16 per cent Y-o-Y led by the Retail and SME segment. Deposit growth, on the other hand, is expected to mirror credit growth. Quantum of margin compression likely to be slightly higher Q-o-Q," Axis Securities said.
 

Key monitorables, the brokerage said, will be NIM outlook, and comments on growth in the unsecured book.

YES Securities

YES Securities expects ICICI Bank's sequential loan growth to be 4 per cent due to "idiosyncratic growth trajectory". NII growth, it said, will be slightly slower than average loan growth due to rise in cost of deposits.

Opex growth will be higher than loan growth due to appraisal season, and slippages would be broadly stable on sequential basis.

In absolute terms, it pegs net profit at Rs 10,875.7 crore (up 13 per cent Y-o-Y/1.6 per cent Q-o-Q), PPoP at Rs 15,259.8 crore (up 8 per cent Y-o-Y/1.5 per cent Q-o-Q), and NII at Rs 19,665.9 crore (up 8 per cent Y-o-Y/3 per cent Q-o-Q).