ICICI Bank price target raised to INR1,720 from INR1,680 at UBS

Investing.com - UBS raised its price target on ICICI Bank (ICICIBC:IN) (NYSE:IBN) to INR1,720.00 from INR1,680.00 while maintaining a Buy rating on the stock. The bank, currently valued at $120.7 billion, is trading near its 52-week high of $34.50. According to InvestingPro data, analysts see an additional 22% upside potential.

The bank reported Q1FY26 profit after tax of Rs127.7 billion, exceeding UBS estimates due to better pre-provision operating profit and treasury gains, partially offset by higher credit costs at 54 basis points annualized. InvestingPro analysis shows the bank maintains a GOOD financial health score, with particularly strong metrics in growth (3.44/5) and profitability (3.26/5).

ICICI Bank’s core pre-provision operating profit grew 13.6% year-over-year, outperforming peers, while net interest income increased 10.6% year-over-year and core fee income rose approximately 7.5% compared to the same period last year.

The bank’s reported net interest margin declined 7 basis points quarter-over-quarter to 4.34%, though this figure was aided by a 7 basis point interest benefit from income tax refunds in Q1.

UBS expects ICICI Bank to maintain a return on assets of approximately 2.2% in FY26/FY27 and believes the bank’s superior operating performance compared to peers will continue to support its premium valuation at approximately 2.5 times September 2026 estimated price-to-book value. The stock currently trades at a P/E ratio of 20.1x, and InvestingPro analysis suggests the shares are currently undervalued based on their proprietary Fair Value model. Discover 10+ additional exclusive ProTips and comprehensive valuation metrics with an InvestingPro subscription.

In other recent news, ICICI Bank has seen several adjustments in its stock price targets following its latest quarterly earnings report. Goldman Sachs raised its price target to INR1,644, citing the bank’s core operating profits exceeding expectations by 6% and a 14% year-over-year growth. Despite these positive results, Goldman Sachs expressed concerns about potential challenges such as a slowdown in loan growth and aggressive pricing in the mortgage market. Meanwhile, Axis Capital (NYSE:AXS) increased its price target to INR1,620, maintaining an "Add" rating and highlighting ICICI Bank’s strong credit growth prospects in the mortgage and unsecured segments. Axis Capital also noted that the bank’s dominant retail franchise could help offset near-term earnings pressures. CLSA raised its target to INR1,700, keeping an Outperform rating, after ICICI Bank’s pre-provision operating profit and profit after tax surpassed estimates by 8% and 11%, respectively. The bank’s net interest margin showed improvement, and operational expenses aligned with management’s guidance, contributing to a strong quarterly performance. These developments reflect the bank’s strategic focus on profitability and asset quality, as noted by CLSA.

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