ICICI Bank shares surge nearly 7%; mcap rises by Rs 127.8 bn

Shares of ICICI Bank surged nearly 7 per cent on Tuesday, adding Rs 127.86 billion to its market valuation, on expectations of improvement at the asset quality front.

The stock ended with a sharp gain of 6.86 per cent at Rs 309.25 on BSE. During the day, it soared 8.67 per cent to Rs 314.50.

At NSE, shares of the company surged 6.72 per cent to close at Rs 309.30.

The stock was the biggest gainer on both Sensex and Nifty.

Led by the sharp rally in the stock, the company's market valuation zoomed Rs 12,786.96 crore to Rs 1,98,812.96 crore.

In terms of equity volume, 38 lakh shares of the company were traded on BSE and over 8 crore shares changed hands at NSE during the day.

"ICICI Bank held centre stage as it contributed more than 30 points to the Nifty. Hadn't it been for ICICI Bank, the Nifty could have closed with a sizeable loss. Though the quarterly numbers from the bank were nothing to write home about, investors flocked to the counter on belief that the worst may be over for the corporate facing bank," said VK Sharma, Head Private Client Group & Capital Market Strategy, HDFC Securities.

The company's results were announced post market hours yesterday.

The company's management yesterday said much of the stress from the changes in regulations is behind the bank and hinted at business as usual on NPA accretion front from here onwards.

The bank is targeting to bring down net NPAs to 1.5 per cent and take the provision coverage ratio to 70 per cent by March 2020.

ICICI Bank yesterday posted 45 per cent decline in consolidated net profit to Rs 1,142 crore for three months to March as bad loans surged.

The leading private sector lender had a consolidated profit of Rs 20.83 billion in January-March, 2016-17.

Total income on consolidated basis rose to Rs 337.60 bn as against Rs 28,603 crore.

On standalone basis, the bank recorded 50 per cent fall in net profit at Rs 10.20 billion in the reported quarter. In the year-ago period, the same stood at Rs 20.25 billion.

Gross non-performing assets (NPAs) of the bank rose to 8.84 per cent as a percentage of gross advances at the end of March, compared to 7.89 per cent a year ago.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel