EUR 120.00 For Business Accounts Only

MOSL: Morning India (07/May/19): 1. ICICI Bank (Operating performance on track); 2. Bharti Airtel; 3. Marico (High visibility on volumes/margins strengthens outlook); 4. LIC Housing Finance (Margins surprise po

MOrning India (07/May/19): 1. ICICI Bank (Operating performance on track); 2. Bharti Airtel; 3. Marico (High visibility on volumes/margins strengthens outlook); 4. LIC Housing Finance (Margins surprise positively); 5. Aditya Birla Capital; 6. Bulls & Bears

 

Today’s top research idea

ICICI Bank: Operating performance on track normalization

• ICICI Bank reported 4QFY19 PAT of INR9.7b, mainly affected by higher provisions of INR54.5b. NII grew 26.5% YoY to INR76.2b, led by 32bp QoQ improvement in margins to 3.72%. Advances grew 14.5% YoY, with domestic book growing by 17% YoY (~22% YoY growth in retail).
• Fresh slippages stood at INR35.5b, largely affected by technical downgrade of sugar account driven by regulatory interpretation. However, healthy recoveries/upgrades of INR15.2b and write-offs of INR73.2b drove 105bp/52bp QoQ decline in GNPL/NNPL ratios to 6.7%/2.06%. PCR improved 217bp QoQ to 70.7% (80.7% including TWO).
• ICICIBC has delivered a steady performance at the PPOP level and is showing signs of earnings normalization. With asset quality stabilizing, we expect credit cost to moderate meaningfully in FY20/21, boosting return ratios. We revise our SOTP-based PT to INR470 (2.0x FY21 ABV).

Piping hot news

US cannot ensure crude sale to India at concessional rate: US Commerce Secretary Wilbur Ross

• The US Monday said it cannot ensure the sale of its crude oil to India at concessional rates to make up for the cheaper Iranian oil going out of the market. "Oil is owned by private people, so the government cannot force people to make concessionary price," US Commerce Secretary Wilbur Ross, who is here to participate in a trade forum, told reporters.