ICICI Bank Q4 Preview: Private lender’s profit, NII likely to grow in double digits, asset quality may improve

ICICI Bank's profit may come in at Rs 8,850 crore for the fourth quarter of the last fiscal year, a 26 per cent increase on a year-on-year basis, according to Zee Business research.

ICICI Bank shares closed 0.5 per cent lower on Friday, a day ahead of the scheduled release of the lender's Q4 results. | Image: Reuters

ICICI Bank – India’s second-largest private lender – is expected to report a robust set of earnings for the quarter ended March 2023 (Q4FY23), with analysts expecting double-digit percentage growth in both the top-line and the bottom-line. They also expect improvement in the bank's asset quality.

ICICI Bank will report its financial results on Saturday, April 22.

According to Zee Business research, the banking major’s profit may stand at Rs 8,850 crore, which translates to a 26 per cent increase compared with the corresponding period a year ago.

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The analysts estimate ICICI Bank's net interest income (NII) – or the difference between interest earned and interest paid – at Rs 17,200 crore for the three-month period, which would mean growth of 36.5 per cent.

ICICI Bank's net interest margin (NIM) – a key measure of profitability for lenders – is estimated to be around 4.7-4.8 per cent for a three–month period, aided by a rapid rise in benchmark interest rates, according to Zee Business research.

The bank is likely to report improvement in its asset quality, gauged by the percentage of bad loans in total loans.

According to the research, ICICI Bank's gross non-performing assets (NPAs) – or bad loans – as a percentage of total loans are estimated at 2.9 per cent for the quarter ended March 2023, as against 3.07 per cent for the previous three months (Q3Fy23). The analysts peg the lender's net NPAs at 0.5 per cent for the March quarter as against 0.55 per cent for the previous three months.

ICICI Bank's loan growth is estimated to be around 18 per cent amid improvement in the SME and retail segments, and deposit growth ta 9-10 per cent, according to the research.

ICICI Bank shares finished with a loss of 0.5 per cent on Friday amid a listless session on Dalal Street, ahead of the lender's scheduled earnings announcement.

Last week, HDFC Bank, India’s largest lender by market value, had reported a strong set of earnings for the March quarter.

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