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India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Focus areas yielding results
CHANGE
Initiate coverage with BUY rating and INR974 target price
ICICI Bank is perhaps the most improved bank in terms of the structural
changes it has made to its balance sheet in the last couple of years. A lot
of the positives are in the price but driving growth will be challenging
hence patient investors should get rewarded in the longer term. Overseas
subsidiaries and investments in a far better position.
CATALYST
Balance sheet expansion key to re-rating
CMP captures a lot of the structural changes, balance sheet expansion
leading to improved RoEs remain the key re-rating trigger. Management
has been guiding for 18-20% loan growth but our estimates factor in 17%
as incremental domestic demand remains on the lower side.
VALUATION
Current valuations extremely attractive for long term investors,
ICICI currently trades at 1.4x FY13E ABV core book (BV adjusted for
subsidiaries at INR131 per share and market price of INR238 for value
given to subsidiaries). Downside risks to our TP and estimates could arise
from lower loan growth and higher than expected slippages in the
corporate commercial real estate and infrastructure segment.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Focus areas yielding results
CHANGE
Initiate coverage with BUY rating and INR974 target price
ICICI Bank is perhaps the most improved bank in terms of the structural
changes it has made to its balance sheet in the last couple of years. A lot
of the positives are in the price but driving growth will be challenging
hence patient investors should get rewarded in the longer term. Overseas
subsidiaries and investments in a far better position.
CATALYST
Balance sheet expansion key to re-rating
CMP captures a lot of the structural changes, balance sheet expansion
leading to improved RoEs remain the key re-rating trigger. Management
has been guiding for 18-20% loan growth but our estimates factor in 17%
as incremental domestic demand remains on the lower side.
VALUATION
Current valuations extremely attractive for long term investors,
ICICI currently trades at 1.4x FY13E ABV core book (BV adjusted for
subsidiaries at INR131 per share and market price of INR238 for value
given to subsidiaries). Downside risks to our TP and estimates could arise
from lower loan growth and higher than expected slippages in the
corporate commercial real estate and infrastructure segment.
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