ICICI Bank Q1 net profit rises 16% to Rs 14,805 crore, beats estimates
- Net profit rose 16% year-on-year to Rs 14,805 crore, exceeding analyst expectations.
- Net interest income increased 13% on the back of expanding margins.
- Asset quality metrics improved during the quarter.
ICICI Bank has reported a 16% jump in its standalone net profit for the first quarter of the current financial year, coming in at Rs 14,805 crore. The figure has surpassed market estimates, driven by healthy interest income growth and improved asset quality.
The country's second-largest private sector lender had posted a net profit of Rs 12,760 crore in the same quarter last year.
Net interest income rises 13%
The bank's net interest income (NII) grew 13% year-on-year, supported by expanding net interest margins (NIM). The core lending income benefited from the bank's continued focus on high-yield retail and corporate loans.
Analysts had expected a slightly lower profit number, making the actual performance a positive surprise for the market. The beat was largely attributed to lower provisions and steady fee income growth.
Asset quality shows improvement
ICICI Bank's asset quality metrics improved during the quarter. The gross non-performing asset (GNPA) ratio declined sequentially, reflecting better recoveries and lower slippages.
The bank has maintained its disciplined approach to underwriting, which has helped keep stress levels in check. Provisions also remained under control, further aiding profitability.
The net NPA ratio too narrowed, indicating a healthier loan book. The bank's overall credit cost was lower than in the preceding quarters.
Loan growth remains steady
The lender reported steady loan growth during the quarter, with particular strength in the retail and small business segments. Corporate loan demand also showed signs of revival.
Deposit growth remained healthy, ensuring the bank had adequate liquidity to fund its expanding loan book. The management has expressed confidence in maintaining this growth trajectory.
What to watch next
Investors will now focus on the bank's outlook for the remainder of the financial year, particularly its guidance on margins and credit costs. The market will also watch for any commentary on the impact of the evolving interest rate environment on the bank's operations.