ICICI Bank shares among top Nifty gainers, up over 2% post strong Q1 results – what should investors do? Brokerages recommend this

ICICI Bank shares: On the back of strong first-quarter earnings in the financial year 2022-23 (Q1FY23), the shares of ICICI Bank, an index heavyweight, surged over 2 per cent to Rs 817.85 per share on the BSE intraday and trading as one of the top Nifty50 gainers on Monday. 

Amid strong numbers, even the brokerages are bullish on the ICICI Bank stock and maintained a Buy rating as they see an upside of up to 35 per cent in the share price from Friday’s closing of Rs 800 apiece. 

Nirmal Bang, a domestic brokerage house, maintained a Buy rating on ICICI Bank with a target price of Rs 1,079 per share, which implies a nearly 35 per cent upside on the stock. 

Similarly, Jefferies also gives a Buy rating on ICICI Bank with a target of Rs 1080 apiece (35% upside). It said, the bank continues to lead in core performance and valuations are attractive, even in a global context. 

CLSA and Morgan Stanley give a common target of Rs 1040 per share (30% upside) for ICICI Bank. While the former has given a Buy rating, the latter has an Overweight rating for the private lender.

CLSA said bank is now consistently delivering sector-best loan & core PPoP growth and added almost all P&L provisioning is in addition to contingencies. And Morgan Stanley said outperformance on CASA deposits and digital capabilities will drive rerating. 

While Credit Suisse gives an Outperform rating on ICICI Bank with a target price of Rs 950 per share, implying an 18 per cent upside. The brokerage raises FY2/24 estimates by 4 per cent as adjusted for improved margin and asset quality. ICICI Bank remains among the top pick for Credit Suisse.

ICICI Bank reported net profit growth of around 50 per cent year-on-year, led by strong loan book growth and margin expansion, and lower credit cost. The bank’s credit growth was over 20 per cent YoY, led by 24 per cent YoY growth in retail loans.  

The management sounded confident about credit demand but with a cautious undertone given the inflationary environment and global disturbances; asset quality improved sequentially in Q1FY23.