Earnings effect: ICICI Bank shares hit record high, here are triggers for further upside
The stock of India's second-largest lender by market cap climbed to a high of Rs 1479.70 in early deals on Tuesday against the previous close of Rs 1465.85 on BSE.
- Jul 22, 2025,
- Updated Jul 22, 2025 11:00 AM IST
Shares of private sector lender ICICI Bank hit a record high in early deals on Tuesday on the back of healthy Q1 earnings. The stock of India's second-largest lender by market cap climbed to a high of Rs 1479.70 in early deals on Tuesday against the previous close of Rs 1465.85 on BSE.
Incred Equities expects the stock to reach a high of Rs 1,650 in a year. It believes the stock’s rerating from here on will hinge on its volume growth outcome.
The brokerage expects return on equity (RoE) to 16% over FY26F-27F and sees an earnings CAGR of 11% over FY25-27F. "1QFY26 earnings beat was led by better NII, strong treasury income and contained costs. Credit costs remain at a normalized level, although up slightly. We revisit our earnings estimates to factor in 1QFY26 results (marginal change to our book value)," said Incred Equities.
Axis Securities too has a price target of Rs 1,650 on Q1 earnings.
The management has highlighted that the bank is comfortable in resuming and accelerating growth in the unsecured segments – Personal loans and Credit cards, as it remains comfortable with the asset quality metrics in terms of originations over the last 12-15 months. "We expect ICICI Bank to deliver a healthy 15% CAGR credit growth over FY25-28E. The bank does not expect any major challenges to asset quality. Resultantly, we pencil-in credit costs of 50-55bps over FY26-28E," said Axis.
The brokerage expects the bank to continue to deliver its strong performance over the medium term, enabling a consistent RoA/RoE delivery of 2.3-2.4%/16-17% over FY26-28E.
"This would be supported by (1) Strong business growth while maintaining a steady C-D Ratio, (2) Focus on strengthening fee income profile, (3) Range-bound Opex ratios with no aggressive investments in sight, (4) Pristine asset quality metrics, and (5) Adequate capitalisation," added Axis.
It has maintained buy call on the stock.
Brokerage BNP Paribas has an outperform call on stock.
It terms the lender as its second most preferred pick after HDFC Bank and assigned a price target of Rs 1,860.
Citing the rationale behind its bullish stance, BNP Paribas said, "ICICIBC's balance sheet remains protected by heavy excess provisioning and healthy capitalisation. It currently also enjoys high CASA as a proportion of NDTL, and therefore, a funding cost edge over its nearest competitors. This has helped the bank gather loan market share in prime categories and emerge as a preferred choice for investors within Indian banking names, in our view."
The lender reported a 15% rise in standalone net profit for Q1 FY26. Net profit climbed to Rs 12,768.21 crore in the first quarter of the current fiscal compared to Rs 11,059.61 crore in Q1FY25.
Return on assets rose to 2.44% in the last quarter against 2.36% in the year ago period.
ICICI Bank's gross NPA ratio fell to 1.67% in the June quarter compared to 2.15% on June 30, 2024. The net NPA ratio was 0.41% in the last quarter compared to 0.43% in the June 2024 quarter and 0.39% in the March 2025 quarter.
Debt to equity ratio slipped to 0.18 in the previous quarter against 0.27 in the June 2024 quarter.
NII -- the difference between interest earned and interest expended -- climbed 8.4 percent to Rs 21,634.46 crore for the June quarter.
Shares of private sector lender ICICI Bank hit a record high in early deals on Tuesday on the back of healthy Q1 earnings. The stock of India's second-largest lender by market cap climbed to a high of Rs 1479.70 in early deals on Tuesday against the previous close of Rs 1465.85 on BSE.
Incred Equities expects the stock to reach a high of Rs 1,650 in a year. It believes the stock’s rerating from here on will hinge on its volume growth outcome.
The brokerage expects return on equity (RoE) to 16% over FY26F-27F and sees an earnings CAGR of 11% over FY25-27F. "1QFY26 earnings beat was led by better NII, strong treasury income and contained costs. Credit costs remain at a normalized level, although up slightly. We revisit our earnings estimates to factor in 1QFY26 results (marginal change to our book value)," said Incred Equities.
Axis Securities too has a price target of Rs 1,650 on Q1 earnings.
The management has highlighted that the bank is comfortable in resuming and accelerating growth in the unsecured segments – Personal loans and Credit cards, as it remains comfortable with the asset quality metrics in terms of originations over the last 12-15 months. "We expect ICICI Bank to deliver a healthy 15% CAGR credit growth over FY25-28E. The bank does not expect any major challenges to asset quality. Resultantly, we pencil-in credit costs of 50-55bps over FY26-28E," said Axis.
The brokerage expects the bank to continue to deliver its strong performance over the medium term, enabling a consistent RoA/RoE delivery of 2.3-2.4%/16-17% over FY26-28E.
"This would be supported by (1) Strong business growth while maintaining a steady C-D Ratio, (2) Focus on strengthening fee income profile, (3) Range-bound Opex ratios with no aggressive investments in sight, (4) Pristine asset quality metrics, and (5) Adequate capitalisation," added Axis.
It has maintained buy call on the stock.
Brokerage BNP Paribas has an outperform call on stock.
It terms the lender as its second most preferred pick after HDFC Bank and assigned a price target of Rs 1,860.
Citing the rationale behind its bullish stance, BNP Paribas said, "ICICIBC's balance sheet remains protected by heavy excess provisioning and healthy capitalisation. It currently also enjoys high CASA as a proportion of NDTL, and therefore, a funding cost edge over its nearest competitors. This has helped the bank gather loan market share in prime categories and emerge as a preferred choice for investors within Indian banking names, in our view."
The lender reported a 15% rise in standalone net profit for Q1 FY26. Net profit climbed to Rs 12,768.21 crore in the first quarter of the current fiscal compared to Rs 11,059.61 crore in Q1FY25.
Return on assets rose to 2.44% in the last quarter against 2.36% in the year ago period.
ICICI Bank's gross NPA ratio fell to 1.67% in the June quarter compared to 2.15% on June 30, 2024. The net NPA ratio was 0.41% in the last quarter compared to 0.43% in the June 2024 quarter and 0.39% in the March 2025 quarter.
Debt to equity ratio slipped to 0.18 in the previous quarter against 0.27 in the June 2024 quarter.
NII -- the difference between interest earned and interest expended -- climbed 8.4 percent to Rs 21,634.46 crore for the June quarter.