1. ICICI Bank (IBN) is the largest private bank in India.
The bank's consolidation phase is over and we expect the lender to leverage any normalization in the credit cycle in future. The management had indicated that credit growth would average 15% to 18% in 2011, riding on improved traction in its international operations. Vehicle loans, home loans, and infrastructure lending are other segments that would do well.
With a current account saving account ratio at 44% and an improved liability profile would sustain NIM's net interest margin at around 2.3% to 2.5% during 2011.
In the recent quarter, the addition of bad loans from ICICI's books were negligible, while the bulk of non-performing loan additions ensued due to the merger of Bank of Rajasthan. The bank also achieved the 70% provision coverage ratio target, we expect earnings impact on account of higher credit costs to decline in the future.Overall, an improving margin profile, steady loan growth and lower provisioning would improve the earnings profile, going forward. The stock is trading at 2.1 times its estimated 2012 book. >To see these stocks in action, visit the 5 Indian Stocks to Watch portfolio on Stockpickr.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV