ICICI BANK 2023-24 Annual Report Analysis

Wed, 7 Aug

ICICI BANK has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the bank during the year 2023-24.

ICICI BANK Income Statement Analysis

• Interest income during the year rose 31.8% on a year-on-year (YoY) basis.
• Interest expenses were up by 46.6% YoY during the same period.
• Operating expenses increased by 18.6% YoY during the year.
• The bank's net interest income (NII) increased by 21.1% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 4.1% in FY24 as against 4.1% in FY23.
• Other income increased by 17.5% YoY during the year.
• Net profit for the year increased by 30.0% YoY.
• Net profit margins during the year declined to 27.7% in FY24 from 28.1% in FY23.

ICICI BANK Income Statement – 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Interest Income	Rs m	1,210,668	1,595,159	31.8%
Other Income	Rs m	651,120	765,218	17.5%
Interest Expense	Rs m	505,434	741,082	46.6%
Net Interest Income	Rs m	705,234	854,078	21.1%
Operating Expense	Rs m	824,390	977,828	18.6%
Pre-provision Operating Profit	Rs m	531,964	641,468	20.6%
Provisions & Contingencies	Rs m	187,334	191,400	2.2%
Profit before tax	Rs m	462,565	604,344	30.7%
Tax	Rs m	117,934	154,276	30.8%
Profit after tax	Rs m	340,366	442,564	30.0%
Minority Interest	Rs m	-14,247	-18,241	-28.0%
Net Interest Margin	%	4.1	4.1
Net profit margin	%	28.1	27.7

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ICICI BANK Balance Sheet Analysis

• The bank's deposits during FY24 stood at Rs 14,435.8 bn as compared to Rs 12,108.3 bn in FY23, thereby witnessing an increase of 19.2%.
• Advances for the year stood at Rs 12,607.8 bn as compared to Rs 10,838.7 bn during FY23, a rise of 16.3%.
• Cost of deposits for ICICI BANK rose 24.9% and stood at 4.1%, while yield on advances rose to 9.2%.
• The lender's investments rose to Rs 8,271.6 bn during the year from Rs 6,395.5 bn in FY23.
• Borrowing stood at Rs 2,074.3 bn, a growth of 9.7% as compared to previous year.
• Overall, the total assets and liabilities for FY24 stood at Rs 23,640.6 bn as against Rs 19,584.9 bn during FY23, thereby witnessing a rise of 20.7%.

ICICI BANK Balance Sheet – as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	2,137,369	2,547,385	19.2%
Advances	Rs m	10,838,663	12,607,762	16.3%
Deposits	Rs m	12,108,322	14,435,800	19.2%
Yield on advances	%	8.1	9.2
Cost of Deposits	%	3.3	4.1
Investments	Rs m	6,395,520	8,271,625	29.3%
Borrowings	Rs m	1,890,618	2,074,280	9.7%
Total Assets	Rs m	19,584,905	23,640,630	20.7%

Current Valuations for ICICI BANK

• The trailing twelve-month earnings per share (EPS) of the bank stands at Rs 63.0, an improvement from the EPS of Rs 48.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,166.6, stands at 15.7 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 3.2 times, while the price to income ratio stands at 4.4 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Income per share (Unadj.)	Rs	173.4	227.2
Earnings per share (Unadj.)	Rs	48.7	63.0
Diluted earnings per share	Rs	48.3	62.9
Avg P/E ratio	Rs	16.7	15.7
Avg P/ABV ratio	Rs	3.2	3.2
Avg Market Cap	Rs	5,685,234	6,944,388
Dividends per share (Unadj.)	Rs	8.00	10.00

Ratio Analysis for ICICI BANK

• Efficiency Ratios

  Credit/Deposit Ratio: The bank's credit/deposit ratio deteriorated and stood at 87.3x during FY24, from 89.5x during FY23. The credit/deposit ratio tells us how much money a bank has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The bank's debt to equity ratio decreased and stood at 6.48x during FY24, from 6.55x during FY23. The debt to equity ratio of a bank tells us how much debt a bank uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): ICICI BANK's capital adequacy ratio (CAR) was at 16.3% as on 31 March 2024 as compared to 18.3% a year ago. This ratio helps measure the financial strength of the bank or any finance company to meet their obligations using their assets and capital.

  A bank that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the bank's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a bank sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the bank is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that banks hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the bank improved and stood at 17.4% during FY24, from 15.9% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the bank improved and stood at 1.87% during FY24, from 1.74% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the bank improved and stood at 17.47% during FY24, from 15.34% during FY23. The ROCE measures the ability of a bank to generate profits from its total capital (shareholder capital plus debt capital) employed in the bank.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a bank's gross NPAs to gross advances. ICICI BANK's gross NPA ratio stood at 2.3% as of 31 March 2024 compared to 2.9% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a bank's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the bank has made provisions.

  The net NPA ratio of ICICI BANK was 0.5% in financial year 2024. This compared with 0.5% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Credit/Deposit Ratio	x	89.5	87.3
Debt to Equity Ratio	x	6.5	6.5
Loans / Deposits	x	0.2	0.1
Capital Adequacy Ratio	%	18.3	16.3
Return on Equity	%	15.9	17.4
Return on Assets	%	1.7	1.9
Return on Capital Employed	%	15.3	17.5
% of Gross NPAs	%	2.9	2.3
% of Net NPAs	%	0.5	0.5
Yield on Advances	x	8.1	9.2
Yield on Investments	x	4.6	5.1

To see how ICICI BANK has performed over the last 5 years, please visit here.

ICICI BANK Share Price Performance

Over the last one year, ICICI BANK share price has moved up from Rs 975.7 to Rs 1,166.6, registering a gain of Rs 190.9 or around 19.6%.

Meanwhile, the S&P BSE BANKEX is trading at 56,845.3 (up 0.6%). Over the last one year it has moved up from 50,325.8 to 56,845.3, registering a gain of 6,519.5 points (up 13.0%).

Overall, the S&P BSE SENSEX is up 20.5% over the year.

(To know more, you can check out historical annual results for ICICI BANK here and quarterly results for ICICI BANK here)