IBN - ICICI Bank: The Recent Enthusiasm Has Been Overdone
- IBN’s CASA strength is less appealing in a low-rate environment and NIMs will likely remain under pressure.
- The cost to income ratio has been subdued over the last two quarters, but at current levels, it is not sustainable.
- IBN will likely see further asset quality stress in H2-21 and any provision release may likely be deferred.
- Various macro indicators remain iffy and aggregate loan growth in India still remains subdued. The recent spike in crude oil prices increases inflation risk.
- Valuations are no longer cheap and the stock is close to historical hurdles.
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ICICI Bank: The Recent Enthusiasm Has Been Overdone