ICICI Bank Q4 result: Here's what to expect

Shares of ICICI Bank ended Monday's trading at Rs 275.85 per piece on BSE, down Rs 3 or 0.95%  a day before its fourth quarter ended March 31, 2017 result.

In the previous three quarters, ICICI Bank witnessed continuous decline in net profit, higher provisions, increasing gross non-performing assets which led to significant deterioration in asset quality and muted net interest income (NII) growth.

During December 31,2016 ended quarter (Q3FY17), ICICI Bank saw 19.1% decline to Rs 2,441.82 crore compared to Rs 3,018.13 crore in the corresponding period of the previous year.

Meanwhile, gross bad loans jumped to Rs 37,716. 73 crore, up 17.21% from a quarter ago.  

In percentage terms, gross bad loans stood at 7.9% at the end of December, up from 6.82% at the end of the previous quarter. 

Bad loans net of provisions were 4.35% of advances.

Talking on Q3FY17 performance Chanda Kochhar Managing Director and Chief Executive Officer  of ICICI Bank at that time said, "It is very difficult to give any guidance on resolution of stressed assets as there are too many moving parts involved. Our endeavour is to resolve as much as we can in this year itself.”

What will ICICI Bank's last quarter for FY17 be like?

Nilesh Parikh, Kunal Shah and Prakhar Agarwal  of Edelweiss Financial Services said, "Loan offtake will be lower, however NII will likely benefit from better/sustained NIMs benefitting from lower funding costs. We expect credit cost to be elevated and the indication/guidance on FY18 will be critical for future performance."

Analysts at Motilal Oswal said, "We expect loan growth to improve to 9% year-on-year (YoY)  and above 4% quarter-on-quarter (QoQ) basis , led by continued growth in retail loans, which have shown a steady pickup in the last two years. However, Corporate loan growth would be moderate and international loan exposure would continue to decline. Slower growth coupled with a YoY decline in NIM (due to lower C-D ratio) should lead to moderate growth in NII on a YoY basis."

As for fee income growth, Motilal expect it to be muted in Q4. They have factored in 8% YoY growth in fee income, led by low corporate fees. 

Gross slippages are expected to remain high in 4QFY17, with slippage ratio projected around  6.5%. Motilal said, " Bulk of the corporate slippages would be from within the watch list. Outstanding watch list (fundbased and non-fund-based) stood at Rs 27,540 crore  in 3QFY17."

Motilal expects ICICI Bank to report net profit of Rs 2,441.8 crore, a whopping 248% year-on-year (YoY) growth and also up 6.48% quarter-on-quarter (QoQ) basis. Net Interest Income is seen at Rs 5,432.8 crore, sequentially increasing by 0.52% yoy and 1.29% qoq. 

For NII, Motilal said, "Moderate trading gains and one-off stake sale in previous quarters would reflect in lower overall non-interest income growth on a QoQ/YoY basis."

On the other hand, Systematix expect net profit to be at Rs 2,074.5 crore, declining by 15% qoq but clocking nearly 196% growth on yoy basis. NII is estimated at Rs 5,959.7 crore, growing by 10.3% yoy and 11.1% qoq.