ICICI Bank 4Q FY 2013

4QFY2013 Result Update | Banking
April 29, 2013
ICICI Bank
Performance Highlights
Particulars (` cr) NII Pre-prov. profit PAT 4QFY13 3,803 3,604 2,304 3QFY13 3,499 3,452 2,250 % chg (qoq) 8.7 4.4 2.4 4QFY12 3,105 3,112 1,902 % chg (yoy) 22.5 15.8 21.2
BUY
CMP Target Price
Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code Banking 132,935 1.3 1231/767 290705 10 19,388 5,904 ICBK.BO ICICIBC@IN
`1,152 `1,352
12 Months
Source: Company, Angel Research
ICICI Bank delivered a healthy performance for 4QFY2013, with net profit growth of 21.2% yoy. On the operating front, the bank witnessed a healthy 22.5% yoy growth in its Net interest Income; however, disappointment on the non-interest income (excl. treasury) front, which grew at a muted 2.2% yoy, limited the operating profit growth to 15.8% yoy. On the asset quality front, the bank reported sequentially stable NPA ratios and incremental restructuring at ~`800cr, which is on guided lines. Business growth moderates; NIMs improve sequentially by 26bp: During 4QFY2013, the banks advances grew by 14.4% yoy, aided by a strong 30.0% yoy growth in the domestic corporate book, due to bulky short term lending done earlier during the year. Growth in the retail portfolio was moderate at 11.4% yoy, as buyouts were significantly lower this year. On the deposits front, the bank witnessed growth of 14.5 % yoy. CASA accretion was lower than peers at 10.4% yoy, primarily aided by savings deposits, which increased by 12.6% yoy, even as current deposits grew at a subdued pace of 5.6% yoy. The CASA ratio declined by around 150bp yoy to 41.9%. The reported overall NIM improved by 26bp qoq to 3.3%, mainly on account of a 23bp sequential improvement in the domestic NIM to 3.7%, while international NIMs remained stable sequentially at 1.3%. Growth in Non-interest income (excluding treasury) came in modest at 2.2% yoy, as corporate fee income was down more than 30% yoy. During the quarter, the bank registered treasury gains of `93cr (primarily bond gains, with the equity portfolio witnessing MTM losses) as against `158cr in 4QFY2012. On the asset quality front, the bank reported flat Gross and net NPA ratio at 3.2% and 0.8%, respectively. During the quarter, the bank restructured loans worth `788cr, on guided lines, thereby taking its restructured book to `5,315cr. As per the Management, advances worth `700cr remain in the pipeline for restructuring. Outlook and valuation: The banks substantial branch expansion in the past three to four years and strong capital adequacy has positioned it to grow at least by a few percentage points higher than the average industry growth. Moreover, a lower risk balance sheet has driven down NPA provisioning costs. Further improvement in risk adjusted NIMs and higher growth is expected to drive a 15.5% CAGR in net profit over FY2013-15 and enable a RoE of 15.6% by FY2015E (with further upside from financial leverage). At the current market price, the banks core banking business (after adjusting `158/share towards value of the subsidiaries) is trading at 1.71x FY2015E ABV (including subsidiaries, the stock is trading at 1.66x FY2015E ABV). We value the banks subsidiaries at `158/share and the core bank at `1,195/share (2.1x FY2015E ABV). We recommend Buy rating on the stock with a target price of `1,352.
Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 24.2 67.3 8.6
Abs. (%) Sensex ICICI Bank
3m (3.0) (4.0)
1yr 12.8 32.6
3yr 10.8 22.0
Vaibhav Agrawal
022 3935 7800 Ext: 6808 vaibhav.agrawal@angelbroking.com
Key financials (Standalone)

Y/E March (` cr) NII % chg Net profit % chg NIM (%) EPS (`) P/E (x) P/ABV (x) RoA (%) RoE (%) FY2012 10,734 19.0 6,465 25.5 2.7 56.1 20.5 2.2 1.3 12.8 FY2013 13,866 29.2 8,325 28.8 3.0 72.2 16.0 2.0 1.5 14.6 FY2014E 16,472 18.8 9,676 16.2 3.1 83.9 13.7 1.8 1.5 15.2 FY2015E 19,472 18.2 11,104 14.8 3.2 96.2 12.0 1.7 1.5 15.6
Sourabh Taparia
022 3935 7800 Ext: 6872 sourabh.taparia@angelbroking.com
Akshay Narang
022 3935 7800 Ext: 6829 akshay.narang@angelbroking.com Harshal Patkar 022 3935 7800 Ext: 6847 harshal.patkar@angelbroking.com
Please refer to important disclosures at the end of this report
ICICI Bank | 4QFY2013 Result Update
Exhibit 1: 4QFY2013 performance (Standalone)

Particulars (` cr) Interest earned - on Advances / Bills - on investments - on balance with RBI & others - on others Interest Expended Net Interest Income Other income Other income excl. treasury - Fee income - Treasury income - Other income Operating income Operating expenses - Employee expenses - Other Opex Pre-provision Profit Provisions & Contingencies PBT Provision for Tax PAT Effective Tax Rate (%)
4QFY13 10,365 6,971 2,820 134 440 6,562 3,803 2,208 2,115 1,775 93 340 6,011 2,407 1,000 1,408 3,604 460 3,144 840 2,304 26.7
3QFY13 10,138 7,066 2,742 136 194 6,639 3,499 2,215 1,964 1,771 251 193 5,714 2,261 941 1,321 3,452 369 3,084 834 2,250 27.0
% chg (qoq) 2.2 (1.3) 2.8 (1.4) 127.0 (1.2) 8.7 (0.3) 7.7 0.2 (62.9) 76.6 5.2 6.5 6.3 6.6 4.4 24.8 2.0 0.8 2.4 (31)bp
4QFY12 9,175 6,128 2,615 128 303 6,070 3,105 2,228 2,070 1,728 158 342 5,333 2,222 1,103 1,119 3,112 469 2,642 741 1,902 28.0
% chg (yoy) 13.0 13.7 7.8 5.0 45.2 8.1 22.5 (0.9) 2.2 2.7 (41.1) (0.7) 12.7 8.4 (9.4) 25.8 15.8 (2.0) 19.0 13.4 21.2 (131)bp
FY2013 40,076 27,341 11,009 543 1,182 26,209 13,866 8,346 7,851 6,902 495 949 22,212 9,013 3,893 5,120 13,199 1,803 11,397 3,071 8,325 26.9
FY2012 33,543 22,130 9,684 491 1,238 22,809 10,734 7,503 7,515 6,707 (12) 808 18,237 7,850 3,515 4,335 10,386 1,583 8,803 2,338 6,465 26.6
% chg (yoy) 19.5 23.5 13.7 10.6 (4.5) 14.9 29.2 11.2 4.5 2.9 17.4 21.8 14.8 10.8 18.1 27.1 13.9 29.5 31.4 28.8 39bp
Exhibit 2: 4QFY2013 Actual vs estimates

Particulars (` cr) Net interest income Other income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT
Actual 3,803 2,208 6,011 2,407 3,604 460 3,144 840 2,304
Estimates 3,704 2,360 6,063 2,474 3,590 382 3,207 867 2,340
Var. (%) 2.7 (6.4) (0.9) (2.7) 0.4 20.4 (2.0) (3.1) (1.5)
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Exhibit 3: 4QFY2013 performance analysis (Standalone)

Particulars Balance sheet Advances (` cr) Deposits (` cr) Credit-to-Deposit Ratio (%) Current deposits (` cr) Saving deposits (` cr) CASA deposits (` cr) CASA ratio (%) CAR (%) Tier 1 CAR (%) Profitability Ratios (%) Reported NIM Cost-to-income ratio Asset quality Gross NPAs (` cr) Gross NPAs (%) Net NPAs (` cr) Net NPAs (%) Provision Coverage Ratio (%) Slippage ratio (%) Provision exps. to avg. assets (%)
4QFY13 3QFY13 % chg (qoq) 4QFY12 % chg (yoy) 290,249 286,766 292,614 286,418 99.2 36,926 85,651 41.9 18.7 12.8 3.3 40.0 9,608 3.2 2,231 0.8 76.8 1.2 0.3 100.1 35,674 81,463 40.9 19.5 13.3 3.1 39.6 9,763 3.3 2,182 0.8 77.7 1.3 0.3 1.2 253,728 2.2 255,500 (93)bp 3.5 5.1 99bp (79)bp (45)bp 26bp 47bp (1.6) (9)bp 2.2 1bp (90)bp (11)bp 6bp 99.3 34,973 76,046 43.5 18.5 12.7 3.0 41.7 9,475 3.6 1,861 0.7 80.4 1.2 0.4 14.4 14.5 (11)bp 5.6 12.6 10.4 (156)bp 22bp 12bp 32bp (161)bp 1.4 (40)bp 19.9 4bp (360)bp 5bps (6)bp
122,577 117,137
4.6 111,019
Business growth moderates; NIM higher by 26bp qoq

During 4QFY2013, the banks advances grew by 14.3% yoy (1.2% qoq), aided by a strong 30.0% yoy growth in the Domestic corporate book. Growth in the corporate portfolio was due to increased working capital funding and project loans disbursement from existing sanctions. Going forward, the Management expects moderation in domestic corporate loan book from current levels and targets around 20% yoy growth in total domestic loan book for FY2014. Overseas loan book grew at a subdued pace of 5.6% yoy, primarily on account of INR depreciation. In dollar terms, overseas advances remained flat on a yoy basis. Going forward, the Management targets overseas loan book growth of 10% yoy for FY2014, which would be driven largely by the appetite of the borrowers for foreign currency loans over domestic rupee loans. Growth in the retail loan portfolio came in moderate at 11.4% yoy, however the organic retail portfolio (after excluding buyouts and Inter-bank participation certificates) for the bank grew strongly by 25.6% on a yearly basis. Within retail, robust traction was witnessed in mortgages, which grew by 18.2% yoy. Going forward, the Management targets a retail loan book growth of 25% yoy for FY2014, which would primarily come from growth in mortgages and in the vehicles loan book. Deposits accretion was modest with a growth of 14.5% yoy (2.2% qoq). The growth in CASA deposits was lower than peers at 10.4% yoy (4.6% qoq). While savings deposits increased by 12.6% yoy (5.1% qoq), the current deposits increased by
April 29, 2013
5.5% yoy (3.5% qoq). As of 4QFY2013, the CASA ratio improved sequentially by 100bp to 41.9% (though lower by 160bp yoy). The average CASA improved to 38.1% in 4QFY2013. Going forward, the Management expects CASA ratio to remain stable at the current levels. The reported overall NIM improved by 26bp sequentially at 3.3%, mainly on account of 23bp qoq improvement in domestic NIM to 3.7%, while International NIMs remained flat at 1.3%. Lower margins were because of excess liquidity in the overseas market. Going ahead, the Management expects overall margins to improve by 10bp in FY2014 over FY2013.
Exhibit 4: Higher Domestic Corporate lending aided loan book growth

Particulars (` cr) Domestic Corporate Overseas branches SME Retail -Home -Vehicle loans -Others -Business Banking -Credit cards -Personal loans Total advances
FY2013 94,331 73,433 15,093 107,392 57,562 25,989 13,209 6,336 2,685 1,611 290,249
FY2012 82,015 78,574 17,206 108,971 55,030 30,076 11,987 7,846 2,833 1,199 286,766
% chg (yoy) 15.0 (6.5) (12.3) (1.4) 4.6 (13.6) 10.2 (19.2) (5.2) 34.4 1.2
% to Total 32.5 25.3 5.2 37 19.8 9.0 4.6 2.2 0.9 0.6 100
Exhibit 5: Business growth moderates

Adv. yoy growth 24.0 21.0 18.0 15.0 12.0 9.0 6.0 3.0 (3.0) 99.3 100.2 Dep. yoy growth 97.7 100.1 CDR (%, RHS) 110.0 99.2 100.0 90.0 80.0
Exhibit 6: CASA ratio improves sequentially to 41.9%

45.0 40.0 35.0 30.0 25.0 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13 9.1 3.2 CASA ratio (%) CASA yoy growth (%) 20.0
12.4
10.9
10.4 10.0
17.3 13.3
21.6 16.1
17.6 14.8
16.5 9.9
14.4 14.5
43.5
40.6
40.7
40.9
70.0 60.0
41.9
4QFY12 1QFY13 2QFY13 3QFY13 4QFY13

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Exhibit 7: Reported NIM improves by 26bp qoq

NIM (Reported, %) 3.5 3.0 2.5 2.0 1.5 1.0 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13 3.0 3.0 3.0 3.1 3.3
Exhibit 8: NII growth continues to remain strong

NII (` cr) 4,100 3,800 3,500 3,200 2,900 2,600 2,300 2,000 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13
YoY growth (%, RHS) 34.5 29.0 22.5 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 -
32.4 23.7
Fee income moderation continues

During 4QFY2013, the non-interest income (excluding treasury) for the bank grew at subdued 2.2% yoy to `2,115cr, as trends of moderation in the fee income continued. Fee income grew at a muted pace of 2.7% yoy, on back of lower corporate banking fee income on account of slowdown in financial closures. Going forward, the Management expects improvement in overall fee income and targets lower double digit growth in fee income. The bank registered lower treasury gain of `93cr (primarily bond gains, with the equity portfolio witnessing MTM losses) as against `158cr in 4QFY2012. Income from other segment remained flat at `340cr. Overall, other income for the bank came in flat at `2,208cr.
Exhibit 9: Muted growth in Fee income, affects other income performance 4QFY13 3QFY13 % chg (qoq) 4QFY12 % chg (yoy) Particulars (` cr)
Fee income Treasury Others Other income Other income excl. treasury
1,775 93 340 2,208 2,115
1,771 251 193 2,215 1,964
0.2 (62.9) 76.2 (0.3) 7.7
1,728 158 342 2,228 2,070
2.7 (41.1) (0.6) (0.9) 2.2
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Exhibit 10: Fee income moderation continues

1,800 Fee Income (` cr) 4.4 yoy growth (%, RHS) 4.1 2.7 1,700 (3.5) 0.5 5.0
Exhibit 11: Still, healthy share of fee income in RoA

1.6 1.5 1.4 1.3 1.2 1.5 1.4 1.4 1.4 1.3 Fee income to average assets (%)
1,600
1,728
1,647
1,709
1,771
1,775
1.1
(5.0)
1,500 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13
1.0 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13
Asset quality remains stable sequentially

During 4QFY2013, the bank reported stability on the asset quality front, as gross NPA levels improved sequentially by 1.6%, on an absolute basis, primarily aided by sequentially lower slippages. Slippages for the quarter came in at `779cr (annualized slippages rate at 1.2%) compared to `850cr in 3QFY2013 and `635cr in 4QFY2012. Gross NPA ratio declined sequentially by 9bp qoq to 3.3%, while net NPA ratio remained stable at 0.8% sequentially. The PCR for the bank as of 4QFY2013 stands healthy at 76.8%. During the quarter, the bank restructured loans worth `788cr (though higher, but was on expected lines), thereby taking its restructured book to `5,315cr. As of 4QFY2013, as per the Managements guidance, advances worth `600-700cr remain in the pipeline for restructuring.
Exhibit 12: Steep rise in O/s Restructured book

(` cr) 6,000 5,250 4,500 3,750 3,000 2,250 1,500 750 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13 4,256 4,172 4,158 4,169 5,315
Exhibit 13: Asset quality stable sequentially

5.0 4.0 Gross NPAs (%) 80.4 80.6 Net NPAs (%) 78.7 Coverage ratio (%, RHS) 85.0 77.7 76.8 80.0 75.0 70.0 65.0
3.6
3.5
3.3
2.0 1.0
0.8
0.7
3.2 0.8 0.8

4QFY13
3.0
3.5 0.7
60.0
4QFY12
1QFY13
2QFY13
3QFY13
Under-leveraged branch network

The number of branches for the bank has almost doubled over the past three years. The branch network improvement was partly aided by the merger with Bank of Rajasthan. This extensive pan-India network of 3,100 branches as of 4QFY2013 is under-leveraged, as reflected in the falling CASA deposits/branch of `39.5cr compared to `49.8cr as of 4QFY2008 and the total assets/branch of `173cr compared to `306cr as of 4QFY2008. Going forward, we expect the bank to leverage this network to further grow its CASA market share.
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Exhibit 14: Largest Pvt. Sector branch network

3,500 3,000 2,500 2,000 1,500
2,016 2,501 2,512 2,529 2,533 2,535 2,552 2,752 2,755 2,772 2,895 3,100
Exhibit 15: Scope for improvement in business/branch

Total Assets/Branch (` cr) 250 200 150 100 50
4QFY10 1QFY11 2QFY11 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 3QFY13 4QFY13
CASA Deposits/Branch (` cr, RHS)
60 50 40 30 20 10 -
1,000 500 -
1QFY11
2QFY11
3QFY11
4QFY11
1QFY12
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
3QFY13
4QFY13
Overview of performance of subsidiaries

The consolidated net profit for FY2013 rose by a healthy 25.7% yoy to `9,604cr. The consolidated reported RoEs for FY2013 improved to 14.7% from 13.0% in FY2012. The overseas subsidiaries of the bank (viz ICICI Bank Canada and ICICI Bank UK) remain over-capitalized, reflecting the banks strategy of consolidating their operations (CAR in excess of 30% in both). Profitability wise, while ICICI Bank Canada witnessed a strong performance with earnings growth of 26.7% yoy at CAD43.6mn, ICICI Bank UK reported a profit de-growth of 43.3% yoy at USD14.4mn. ICICI Prudential Life reported a PAT of `1,496cr for FY2013 and maintained its leadership position amongst private insurers, with a market share of 7.2% (April-February 2012) based on new business retail weighted received premium. During April 2012 to February 2013, the retail weighted received premium for ICICI Life increased by 16.3% compared to a 2.2% yoy growth for the private sector. ICICI General reported a PAT of `306cr for FY2013 compared to a loss of `416cr in 4QFY2012. During the quarter, ICICI Bank infused `74cr in this subsidiary, considering impact of the third party motor pool losses incurred by it in the last 2 years. ICICI Home Finance reported a PAT of `220cr for FY2013, which was lower by 15.3% on a yoy basis. Other smaller subsidiaries reported a mixed performance for FY2013. While ICICI Securities dealership & ICICI AMC reported a PAT growth of 41.8% yoy and 25.0% yoy, PAT for ICICI Venture came in at `20cr compared to `68cr in FY2012 and PAT for ICICI Securities (consolidated) came at `64cr as compared to `78cr in FY2012.
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Exhibit 16: Performance of subsidiaries

Subsidiary ICICI Bank UK ICICI Bank Canada ICICI Bank Eurasia ICICI Home Finance ICICI Prudential Life Insurance Parameter PAT (USD mn) PAT (CAD mn) PAT (USD mn) PAT (` cr) APE (` cr) NBP (` cr) NBP margin (%) AuM (` cr) ICICI Lombard Gen. Insurance ICICI Securities ICICI Securities PD ICICI Venture ICICI Prudential AMC Gross Premium (` cr) PAT (` cr) PAT (` cr) PAT (` cr) PAT (` cr) PAT (` cr) FY2013 14.4 43.6 6.1 220 3,532 529 16.0 74,164 6,420 306 64 122 20 110 FY2012 25.4 34.4 4.3 260 3,118 500 15.0 70,771 5,358 (416) 78 86 68 88 % chg (43.3) 26.7 41.9 (15.4) 13.3 5.8 6.7 4.8 19.8 (173.6) (17.9) 41.9 (70.6) 25.0
Investment arguments
Well positioned to step up growth
ICICI Bank has strategically transformed itself over the past five years, which has expectedly resulted in a significantly better balance sheet and earnings quality. CASA ratio, which was 29% at the end of FY2009, has improved to around 42% as of FY2013. Apart from the paradigm shift in the deposit mix reflected in its healthy CASA ratio, the bank has largely exited unattractive business segments such as small-ticket personal loans in the domestic segment and most non-India related exposures in its international business, which has not only resulted in better asset quality, but has also led to sustainable improvement in NIMs. While the Gross and Net NPA ratios have improved by 110bp and 130bp, respectively to 3.2% and 0.8% as of FY2013 over FY2009, NIMs have improved from 2.6% in to 3.1%, over the same period. Consequently, RoAs and RoEs, which were at a low of 0.9% and 9.2%, respectively in FY2009, have improved to 1.5% and 14.6% in FY2013. Going forward, in our view, there is still scope for moderate upside to RoAs from improvement in risk adjusted NIMs and further to RoEs from improvement in operating and financial leverage. Moreover, in our view, the banks substantial branch expansion from 955 branches at the end of 4QFY2008 to 3,100 branches by 4QFY2013, and strong capital adequacy, at 18.74% (Tier-I at 12.8%) has positioned it to grow at least few percentage points faster than the average industry growth.
Asset quality trends remain healthy

The banks asset quality continues to show improvement, with a stable to declining trend in additions to gross as well as net NPAs. The reduction in risk profile of advances has expectedly resulted in a commensurate decline in credit costs. During FY2013, credit costs for the bank remained under check at 66bp, lower than the Managements guidance of 75bp. Going forward, the Management has
April 29, 2013
cautiously guided for credit costs of 75bp for FY2014. On the restructured front, despite the expected spike in 4QFY2013, the restructuring book remains comfortable at `5,315cr (1.8% of advances). PCR for the bank remained stable at 76.8%, as of 4QFY2013.
Outlook and Valuation

We have a positive view on ICICI Bank, given its market-leading businesses across the financial services spectrum. Moreover, we believe the bank is decisively executing a strategy of consolidation, which has resulted in an improved deposit and loan mix and should drive improved operating metrics over the medium term. The banks substantial branch expansion in the past three to four years and strong capital adequacy has positioned it to grow by at least a few percentage points higher than the average industry growth. Moreover, a lower risk balance sheet has driven down NPA provisioning costs. Further improvement in risk adjusted NIMs and higher growth is expected to drive a 15.5% CAGR in net profit over FY201315E and enable a RoE of 15.6% by FY2015E (with further upside from financial leverage). At the current market price, the banks core banking business (after adjusting `158/share towards value of the subsidiaries) is trading at 1.71x FY2015E ABV (including subsidiaries, the stock is trading at 1.66x FY2015E ABV). We value the banks subsidiaries at `158/share and the core bank at `1,195/share (2.1x FY2015E ABV). We recommend Buy rating on the stock with a target price of `1,352.
Exhibit 17: SOTP valuation summary

Particulars ICICI Bank Life Insurance General Insurance Others (Home Fin, AMC, VC, Securities Securities PD and Overseas subsidiaries) SOTP value
Source: Angel Research
Target multiple 2.1x FY2015E ABV 16.0x FY2015E NBP 10x FY2012 PAT
Value/share (`) 1,195 77 14 67 1,352
Exhibit 18: Key assumptions

Particulars (%) Credit growth Deposit growth CASA ratio NIMs Other income growth Growth in staff expenses Growth in other expenses Slippages Coverage Ratio
Earlier estimates FY2014 22.0 22.0 41.7 3.0 17.0 17.0 17.0 1.7 76.0 FY2015 23.0 23.0 41.9 3.0 22.7 21.3 21.3 1.6 75.0
Revised estimates FY2014 18.0 21.0 41.1 3.1 11.2 17.0 17.0 1.7 76.0 FY2015 21.0 23.0 41.3 3.1 20.4 21.3 21.3 1.6 75.0
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Exhibit 19: Change in estimates

FY2014E Particulars (` cr) NII Non-interest income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT
Earlier estimates 16,449 9,922 26,371 10,623 15,748 2,104 13,644 3,951 9,693
Revised Var. (%) estimates 16,472 9,232 25,705 10,287 15,418 2,043 13,375 3,699 9,676 0.1 (6.9) (2.5) (3.2) (2.1) (2.9) (2.0) (6.4) (0.2)
FY2015E Earlier Revised Var. (%) estimates estimates 19,530 12,087 31,618 12,880 18,737 2,494 16,243 5,091 11,152 19,472 10,858 30,330 12,015 18,315 2,419 15,896 4,793 11,104 (0.3) (10.2) (4.1) (6.7) (2.3) (3.0) (2.1) (5.9) (0.4)
Exhibit 20: Angel EPS forecast vs consensus

Year (`) FY2014E FY2015E Angel forecast 83.9 96.2 Bloomberg consensus 83.5 98.3 Var. (%) 0.5 (2.0)
Source: Bloomberg, Angel Research
Exhibit 21: P/ABV band

2,400 2,100 1,800 1,500 1,200 900 600 300 Price (`) 1x 1.5x 2x 2.5x 3x
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
Nov-06
Nov-07
Nov-08
Nov-09
Nov-10
Nov-11
Nov-12
April 29, 2013
Nov-13
10
Mar-14
Jul-06
Jul-07
Jul-08
Jul-09
Jul-10
Jul-11
Jul-12
Jul-13
Exhibit 22: P/E band

Price (`) 3,200 2,800 2,400 2,000 1,600 1,200 800 400 0
Apr-05 Aug-05 Dec-05 Apr-06 Aug-06 Dec-06 Apr-07 Aug-07 Dec-07 Apr-08 Aug-08 Dec-08 Apr-09 Aug-09 Dec-09 Apr-10 Aug-10 Dec-10 Apr-11 Aug-11 Dec-11 Apr-12 Aug-12 Dec-12 Apr-13
7x
17x
27x
37x
Exhibit 23: ICICI Bank Premium/Discount to the Sensex

(%) 100 80 60 40 20 0 (20) (40) Premium/Discount to Sensex Avg. Historical Premium
Oct-09
Feb-12
Nov-06
May-10
Dec-10
Sep-12
Jun-07
Apr-06
Jan-08
Aug-08
Source: Bloomberg, Angel Research
April 29, 2013
Mar-09
Apr-13
Jul-11
11
Exhibit 24: Recommendation summary

Company Reco. AxisBk FedBk HDFCBk ICICIBk* SIB YesBk AllBk AndhBk BOB BOI BOM CanBk CentBk CorpBk DenaBk IDBI# IndBk IOB J&KBk OBC PNB SBI* SynBk UcoBk UnionBk UtdBk VijBk Buy Neutral Neutral Buy Neutral Neutral Accumulate Neutral Buy Accumulate Neutral Accumulate Neutral Buy Accumulate Neutral Buy Buy Neutral Neutral Accumulate Accumulate Accumulate Neutral Accumulate Accumulate Neutral CMP (`) 1,474 448 694 1,152 24 504 136 92 699 328 56 422 70 379 93 90 165 64 1,321 272 784 2,272 118 69 246 60 53 Tgt. price (`) 1,737 1,352 155 815 360 461 453 101 193 74 889 2,567 130 264 68 Upside (%) 17.8 17.4 13.8 16.7 9.8 9.1 19.6 9.1 17.1 16.2 13.4 12.9 10.3 7.6 12.7 FY2015E P/ABV (x) 1.6 1.0 3.3 1.7 0.9 2.1 0.5 0.6 0.7 0.7 0.6 0.7 0.6 0.5 0.5 0.5 0.6 0.4 1.0 0.6 0.7 1.3 0.6 0.7 0.7 0.4 0.6 FY2015E Tgt. P/ABV (x) 1.9 3.3 1.9 0.6 0.9 0.8 0.8 0.6 0.6 0.7 0.5 0.8 1.4 0.7 0.8 0.5 FY2015E P/E (x) 9.7 7.5 16.3 12.0 5.3 10.5 3.8 3.9 4.8 4.8 4.3 4.9 3.9 3.6 3.5 4.8 3.9 3.1 6.6 4.3 4.4 8.1 4.1 4.8 5.1 2.9 4.9 FY2013-15E EPS CAGR (%) 17.3 10.0 22.8 15.5 11.4 14.9 12.6 4.2 17.0 21.8 14.8 14.0 42.8 8.3 4.3 15.2 6.5 53.3 (5.2) 17.5 12.4 16.4 (3.5) 36.9 21.2 40.4 21.2 FY2015E RoA (%) 1.6 1.2 1.8 1.5 1.0 1.3 0.8 0.8 1.0 0.8 0.6 0.8 0.6 0.8 0.8 0.7 1.0 0.7 1.2 0.8 1.0 1.0 0.7 0.6 0.8 0.7 0.5 FY2015E RoE (%) 17.6 13.7 21.8 15.6 17.1 22.1 14.2 13.4 16.0 15.1 15.6 14.1 13.3 14.4 15.3 11.3 14.9 13.1 16.0 13.1 16.3 17.0 15.2 12.6 15.3 14.7 11.7
Source: Company, Angel Research; Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries), #Without adjusting for SASF
Company Background
ICICI Bank is India's largest private sector bank, with a 5.5% market share in credit. The bank has a pan-India extensive network of nearly 3,100 branches, largest for a private sector bank, and over 10,000 ATMs. The bank has a large overseas presence (overseas loans comprise 25.2% of total loans). The bank also has market-leading subsidiaries in life insurance, general insurance and asset management.
April 29, 2013
12
Income statement (Standalone)

Y/E March (` cr) Net Interest Income - YoY Growth (%) Other Income - YoY Growth (%) Operating Income - YoY Growth (%) Operating Expenses - YoY Growth (%) Pre - Provision Profit - YoY Growth (%) Prov. & Cont. - YoY Growth (%) Profit Before Tax - YoY Growth (%) Prov. for Taxation - as a % of PBT PAT - YoY Growth (%) FY10 8,114 (10.8) 7,478 (7.9) 15,592 (9.4) 5,860 (16.8) 9,732 (4.3) 4,390 (13.0) 5,342 4.4 1,317 24.7 4,025 7.1 FY11 9,017 11.1 6,648 (11.1) 15,665 0.5 6,617 12.9 9,048 (7.0) 2,290 (47.8) 6,758 26.5 1,606 23.8 5,151 28.0 FY12 10,734 19.0 7,503 12.9 18,237 16.4 7,850 18.6 10,386 14.8 1,589 (30.6) 8,797 30.2 2,332 26.5 6,465 25.5 FY13 13,866 29.2 8,346 11.2 22,212 21.8 9,013 14.8 13,199 27.1 1,803 13.4 11,397 29.5 3,071 26.9 8,325 28.8 FY14E 16,472 18.8 9,232 10.6 25,705 15.7 10,287 14.1 15,418 16.8 2,043 13.3 13,375 17.4 3,699 27.7 9,676 16.2 FY15E 19,472 18.2 10,858 17.6 30,330 18.0 12,015 16.8 18,315 18.8 2,419 18.4 15,896 18.9 4,793 30.1 11,104 14.8
Balance sheet (Standalone)

Y/E March (` cr) Share Capital - Equity - Preference Reserve & Surplus Deposits - Growth (%) Borrowings Tier 2 Capital Other Liab. & Prov. Total Liabilities Cash Balances Bank Balances Investments Advances - Growth (%) Fixed Assets Other Assets Total Assets - Growth (%) FY10 1,465 1,115 350 50,503 202,017 (7.5) 63,447 30,467 15,501 363,400 27,514 11,359 120,893 181,206 (17.0) 3,213 19,215 363,400 (4.4) FY11 1,502 1,152 350 53,939 225,602 11.7 72,813 36,391 15,987 406,234 20,907 13,183 134,686 216,366 19.4 4,744 16,347 406,234 12.1 FY12 1,503 1,153 350 59,252 255,500 13.3 102,200 37,615 17,577 473,647 20,461 15,768 159,560 253,728 17.3 4,615 19,515 473,647 17.1 FY13 1,504 1,154 350 65,552 292,614 14.5 108,317 36,674 32,134 536,795 19,053 22,365 171,394 290,249 14.4 4,647 29,087 536,795 13.7 FY14E 1,504 1,154 350 71,881 345,284 18.0 127,189 35,757 31,914 613,529 23,307 21,017 188,194 342,494 18.0 5,168 33,349 613,529 14.7 FY15E 1,504 1,154 350 79,123 417,794 21.0 148,976 34,864 34,132 716,392 18,801 24,617 213,623 414,418 21.0 5,872 39,061 716,392 17.1
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Ratio analysis (Standalone)

Y/E March Profitability ratios (%) NIMs Cost to Income Ratio RoA RoE B/S ratios (%) CASA Ratio Credit/Deposit Ratio CAR - Tier I Asset Quality (%) Gross NPAs Net NPAs Slippages Loan Loss Prov. /Avg. Assets Provision Coverage Per Share Data (`) EPS ABVPS (75% cover.) DPS Valuation Ratios PER (x) P/ABVPS (x) Dividend Yield DuPont Analysis NII (-) Prov. Exp. Adj. NII Treasury Int. Sens. Inc. Other Inc. Op. Inc. Opex PBT Taxes RoA Leverage RoE 2.3 1.2 1.0 0.2 1.2 1.8 3.0 1.6 1.4 0.4 1.0 9.5 9.7 2.4 0.6 1.8 (0.1) 1.7 1.7 3.5 1.8 1.7 0.4 1.3 9.2 11.7 2.5 0.4 2.1 (0.0) 2.1 1.6 3.7 1.8 1.9 0.5 1.3 9.6 12.8 2.8 0.4 2.5 0.1 2.6 1.4 4.0 1.8 2.1 0.6 1.5 9.8 14.6 2.9 0.4 2.6 0.1 2.6 1.4 4.0 1.8 2.2 0.7 1.5 9.9 15.2 3.0 0.4 2.6 0.1 2.7 1.4 4.1 1.8 2.3 0.7 1.5 10.2 15.6 31.9 2.6 1.0 25.8 2.4 1.2 20.5 2.2 1.4 16.0 2.0 1.7 13.7 1.8 2.3 12.0 1.7 2.6 36.1 449.8 12.0 44.7 478.3 14.0 56.1 524.0 16.5 72.2 578.2 20.0 83.9 633.1 26.0 96.2 695.8 30.0 5.1 2.1 1.5 1.2 59.5 4.5 1.1 1.5 0.5 76.0 3.6 0.7 1.3 0.2 80.4 3.2 0.8 1.4 0.3 76.8 3.4 0.8 1.6 0.3 76.0 3.5 0.9 1.6 0.3 75.0 41.7 89.7 19.4 14.0 45.1 95.9 19.5 13.2 43.5 99.3 18.5 12.7 41.9 99.2 18.7 12.4 41.7 99.2 17.1 11.7 41.4 99.2 15.3 10.9 2.4 37.6 1.0 9.7 2.6 42.2 1.3 11.7 2.7 43.0 1.3 12.8 3.0 40.6 1.5 14.6 3.1 40.0 1.5 15.2 3.2 39.6 1.5 15.6 FY10 FY11 FY12 FY13 FY14E FY15E
April 29, 2013
14
Research Team Tel: 022 - 39357800
E-mail: research@angelbroking.com
Website: www.angelbroking.com
DISCLAIMER
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamentals. The information in this document has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance, or other reasons that prevent us from doing so. This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced, redistributed or passed on, directly or indirectly. Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in connection with the use of this information. Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may have investment positions in the stocks recommended in this report.
Disclosure of Interest Statement 1. Analyst ownership of the stock 2. Angel and its Group companies ownership of the stock 3. Angel and its Group companies' Directors ownership of the stock 4. Broking relationship with company covered
ICICI Bank No No No No
Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors
Ratings (Returns):
Buy (> 15%) Reduce (-5% to -15%)
Accumulate (5% to 15%) Sell (< -15%)
Neutral (-5 to 5%)
April 29, 2013
15

ICICI Bank 4Q FY 2013

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ICICI Bank 4Q FY 2013

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4QFY2013 Result Update | Banking

April 29, 2013

Source: Company, Angel Research

Abs. (%) Sensex ICICI Bank

1yr 12.8 32.6

3yr 10.8 22.0

Key financials (Standalone)

Source: Company, Angel Research

Please refer to important disclosures at the end of this report