ICICI Bank, India’s second-largest private sector bank, is announcing its third-quarter earnings today. It will be endorsed by the board of directors today, 25th January, with the third quarter results of FY25.
Net interest income (NII) in the fiscal third quarter ending December ’24 is estimated to ‘jump’ but a slight increase in the net profit.
As for the third quarter of the financial year 2023, the growth rate in the private lender’s business is still considered healthy despite the higher cost ratios, while the margin is expected to moderate mildly.
Axis Securities
The Q3 net profit is estimated by Axis Securities at ₹11,448 crore compared with ₹10,272 crore for the same period last year. NII in Q3FY25 is expected to rise by a healthy 10.6% to ₹20,663 crore from ₹18,679 crore YoY. PPOP of the companies is predicted to be ₹ 16,742 crore, with a YoY rise of 13.7% for Pre Provisions Operating profit.
The brokerage firm opines that India’s third largest bank, ICICI Bank, will maintain a healthy business growth with a stable LDR. Although it estimates that credit costs are likely to be well managed it holds no significant threats to asset quality.
CITI
Citi believes that ICICI Bank’s credit growth will decelerate, as per the system, to 14% YoY and 3% QoQ. Business banking, MSME, and secured retail will also aid in sustaining endogamous YoY business momentum, it asserts. H1 clearing related to deposit repricing and CASA decline may pressure up CoD along with seasonal drag in interest reversal on KCC stress in Q3.
Net Interest Margin (NIM) is expected to decline by 4 basis points in the third quarter of the year, according to Citi. CRR cut, and day-count benefit would only impact Q4. It anticipates slight increases in slippages on this account to sequentially increase on account of seasonal KCC stress, but this is expected to be below 2%.
Both provision coverage and contingency buffer agendas are expected to have 80% provision coverage and 1.07% contingency buffer, respectively, but credit cost is also forecasted to see upward normalization towards the 50 bps limit.