ICICI Bank remains Motilal Oswal’s preferred pick in the banking sector, with the brokerage maintaining a Buy rating and assigning a target price of Rs 1,750, implying a potential upside of about 40 percent from current levels.
Shares of the private lender closed at Rs 1,262 on June 5, up 0.70 percent from the previous close. The stock has delivered a negative return of 13 percent over the past year. The bank’s market capitalisation stood at Rs 9,04,609 crore.
Why Motilal Oswal remains positive
The brokerage expects ICICI Bank to continue gaining market share across key businesses and sees a healthy growth outlook supported by execution and a diversified business model.
Among the factors highlighted by Motilal Oswal are:
- Strong growth across lending segments
- Healthy deposit franchise
- Comfortable loan-to-deposit and liquidity coverage ratios
- Stable margins and pricing power
- Rising fee income
- Operating leverage benefits
- Controlled credit costs
- Strong underwriting standards
- Healthy earnings visibility
Motilal Oswal expects the bank’s cost-to-income ratio to improve to around 38 percent over the coming years.
Q4 FY26 earnings
ICICI Bank reported growth in both pre-tax and net profit during the March quarter.
- Profit before tax, excluding treasury, rose 10.1 percent year-on-year and 21.7 percent quarter-on-quarter to Rs 182.09 billion.
- Profit after tax increased 8.5 percent YoY and 21.1 percent QoQ to Rs 137.02 billion.
- Core operating profit also recorded growth during the quarter.
Loan and deposit growth
Business momentum remained broad-based in Q4 FY26.
- Total advances grew 15.8 percent YoY and 6 percent QoQ.
- Growth was driven by business banking, retail and corporate loans.
- Total deposits rose 11.4 percent YoY and 8.1 percent QoQ.
- Average CASA deposits continued to expand.
Asset quality
The bank’s asset quality improved further during the quarter.
Key indicators included:
- Net NPA ratio of 0.33 percent in Q4 FY26
- Net NPA ratio of 0.37 percent in Q3 FY26
- Provision coverage ratio of 75.8 percent
- Common Equity Tier-1 ratio of 16.35 percent
The brokerage cited controlled credit costs and strong underwriting standards while naming ICICI Bank its top Buy pick among banking stocks.
Founded in 1994, ICICI Bank is one of India’s largest private sector lenders. Headquartered in Mumbai, the bank offers retail and corporate banking services and has a presence in more than 15 countries.
TL;DR
Motilal Oswal has retained a Buy rating on ICICI Bank with a target price of Rs 1,750. The brokerage expects around 40 percent upside, supported by loan growth, deposits, margins and strong asset quality.
AI summary
- Motilal Oswal retained a Buy rating on ICICI Bank.
- The brokerage set a target price of Rs 1,750.
- Potential upside from current levels is about 40 percent.
- Advances rose 15.8 percent in Q4 FY26.
- Net NPA ratio improved to 0.33 percent.
