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Investing.com - Axis Capital (NYSE:AXS) raised its price target on ICICI Bank (ICICIBC:IN) (NYSE:IBN) to INR1,620 from INR1,510 on Thursday, while maintaining an "Add" rating on the stock. The bank, currently trading near its 52-week high of $34.50, has demonstrated strong momentum with a 22% return over the past year.
The research firm described ICICI Bank as a "structural compounder" with industry-leading return profiles and consistent growth outperformance compared to large peers. Axis Capital expects the bank’s strong presence in mortgage and unsecured segments, along with its growing SME and BB franchise, to drive credit growth recovery to approximately 15%. With a market capitalization of $116 billion and impressive revenue growth of 40.5% in the last twelve months, ICICI Bank has established itself as a dominant player in the banking sector. Get deeper insights into ICICI Bank’s growth metrics with InvestingPro.
Axis Capital noted that while net interest margin impact may be higher than peers, a recovery is expected in Q4FY26 or Q1FY27. The bank’s dominant retail franchise provides an additional fee growth lever that could partially offset near-term earnings per share pressures. Trading at a P/E ratio of 19.5x, the bank maintains a "GOOD" Financial Health Score according to InvestingPro’s comprehensive analysis.
The firm projects ICICI Bank will continue to lead in growth and return ratios amongst large private banks in the medium term. Axis Capital maintained its "Add" rating despite rich valuations offering limited upside potential.
The research firm also highlighted that ICICI Bank would be better positioned than peers if system recovery drags, offering a "guarded play on credit growth revival."
In other recent news, ICICI Bank has reported strong financial results, surpassing expectations in several key areas. The bank’s pre-provision operating profit and profit after tax exceeded CLSA’s estimates by 8% and 11%, respectively. This performance has led CLSA analyst Piran Engineer to raise the price target for ICICI Bank to INR1,700, while maintaining an Outperform rating. The bank’s net interest margin increased by 15 basis points quarter over quarter, despite a slowdown in loan growth. Additionally, operational expenses were kept in check, aligning with management’s guidance that projected lower growth in expenses compared to loan growth for fiscal year 2025. ICICI Bank’s asset quality also showed improvement, with better slippage ratios and a notable recovery from a corporate account. These factors contributed to the bank’s solid quarterly performance, prompting CLSA to maintain its estimates largely unchanged. The firm’s valuation for ICICI Bank has been rolled forward to March 2027, supporting the increased target price.
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