VK Sharma of HDFC Securities on Tuesday suggested ICICI Bank as long term pick. Explaining the rationale behind picking ICICI Bank, VK Sharma said, “ICICI Bank has tweaked its corporate loans, decreased their exposure, and the bank’s retail segment is quite vast.” Further, elaborating the retail segment of ICICI Bank, VK Sharma added, “ICICI Bank’s retail is better as compared to other banks because its 63% business comes from things which have security. Hence, qualitatively ICICI Bank is a better retail asset.”
Moreover, VK Sharma, suggested, “ICICI Bank shares can be bought even at the current price, and its target is Rs 442.”
When Zee Business Managing Editor and Market Guru, Anil Singhvi asked, “For how long investors should hold ICICI Bank.”, VK Sharma suggested, “Investors should hold it for 1 year or for target of Rs 442, whichever comes earlier.”
Summarising the suggestions given by VK Sharma, Anil Singhvi said, “Invest for 1 year in ICICI Bank’s stocks with Rs 353 keeping in mind the target of Rs 442.
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On May 9, private sector lender ICICI Bank had reported a 26 per cent year-on-year rise in its standalone net profit for the fourth quarter of 2019-20. According to the bank, its net profit during the quarter under review rose to Rs 1,221 crore from Rs 969 crore reported for the corresponding period of the previous fiscal. “Excluding Covid-19 related provisions, the profit after tax would have been Rs 3,260 crore (US$ 431 million),” the statement said.
Similarly, the bank’s net interest income (NII) during the fourth quarter rose to Rs 8,297 crore from Rs 7,620 crore earned during the corresponding quarter of the previous year.
The bank made provisions (excluding Covid-19 related provisions and provision for tax) worth Rs 3,242 crore during the quarter under review, as compared with the Rs 2,725 crore provisioning in the same quarter of 2018-19. “This provision made by the Bank is more than the requirement as per the Reserve Bank of India’s guideline dated April 17, 2020,” the statement said.
In terms of the full fiscal 2019-20, the bank’s standalone profit after tax rose to Rs 7,931 crore compared with Rs 3,363 crore in FY2019.