ICICI Bank Stock Rises as Q4 Earnings Surpass Analyst Estimates, Brokerages Praise Strong Growth and Low Credit Expenses

ICICI Bank Surpasses Estimates in Q4FY26, Brokerages Turn Constructive on Outlook

ICICI Bank Ltd's stock rose in early trade on Monday, extending gains after closing 0.5 percent higher in the previous session ahead of the release of its March quarter earnings. The lender's shares were trading at Rs 1,368, up 1.6 percent in the morning session.

The bank reported a significant year-on-year rise in net profit, at 8.5 percent, to Rs 13,701.7 crore for Q4FY26, surpassing Street estimates of Rs 12,949 crore. Net interest income (NII), a key measure of core earnings, grew 8.4 percent to Rs 22,979.2 crore, also ahead of expectations.

Key Earnings Highlights

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The bank's asset quality improved sequentially, with the net non-performing asset (NPA) ratio declining to 0.33 percent from 0.37 percent and gross NPA to 1.4 percent from 1.53 percent. Provisions dropped sharply to Rs 96.2 crore from Rs 2,556 crore in the previous quarter, aiding profitability. Advances rose 15.8 percent year-on-year and 6 percent sequentially.

Brokerages largely attributed the earnings beat to lower credit costs and steady growth momentum. Most analysts maintained a positive stance on ICICI Bank shares, with target prices ranging from Rs 1,600 to Rs 1,800 per share.

Brokerage Views

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Brokerages highlighted various factors contributing to the earnings beat, including lower credit costs, strong corporate recoveries, and steady growth momentum. Citi noted that return on assets at 2.4 percent beat estimates, supported by strong corporate recoveries and lower retail stress. CLSA highlighted the improvement in loan growth to 16 percent year-on-year and stable margins. Nomura expected return ratios of around 2.2 percent RoA and 16 percent RoE over FY27-28, with lower credit costs offsetting softer fee income.