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Shares of ICICI Bank rose as much as 11.7 per cent to 344, their highest since September 3. The stock posted sharpest intraday percentage gain since August 9, and was the top percentage gainer on the Nifty 50 index.
The bank had on Friday reported a bigger-than-expected 56 per cent fall in Q2 net profit, but its asset quality improved. It had posted September quarter net profit of Rs 909 crore ($123.75 million) compared with a loss in the June quarter.
Bad loan additions of Rs 3,117 crore in Q2 were down from Rs 4,036 crore in the June quarter. Gross bad loans as a percentage of total loans fell to 8.54 per cent by September end from 8.81 per cent in the previous quarter.
Jefferies says ICICI remains one of its preferred stocks. The brokerage expects continued core pre-provision operating profit (PPoP) growth over the next 3-4 quarters as net interest margin starts expanding, loan growth picks up and asset quality normalises.
Nomura has raised the price target to Rs 415/share from Rs 375/share. It has maintained 'buy' rating, and it says PPoP improvement could surprise positively. “We believe ROE (return on equity) recovery will be faster than earlier expected,” Nomura adds.
Over 17 million shares changed hands, compared with 30-day average of 23.3 million shares.
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