ICICI Bank - March 2013 Results Preview - Motilal Oswal

- Loan and deposit is expected to grow 15-16% YoY led by healthy growth in domestic segment. On the asset side, pick-up in retail loans and working capital financing will be the key drivers.

- Fee income growth is likely to remain moderate at ~9%. However, it would be better than sub 5% growth reported in preceding 5 quarters.

- Bank's asset quality has been holding fairly well over the past few quarters and we expect it to continue, given the benign asset quality in retail segment, changing loan portfolio mix (unsecured retail now forms only 1.4%, v/s 9%+ in FY08) and better risk management practices.

- We have factored 65bp of credit cost for 4QFY13E, and better-than expected asset quality performance could throw a positive surprise.

- Excluding subsidiaries, the stock trades at 1.4x FY15E ABV (BV adjusted for investment in subsidiaries) and 10x FY15E EPS. Buy.

Source : Equity Bulls

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