ICICI Bank becomes the second lender to cross ₹8 lakh crore in market capitalisation

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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ICICI Bank Ltd.’s market capitalisation surged past ₹8 lakh crore on Monday for the first time ever on the back of better-than-expected results for the March quarter.

The private lender gained another 5% on Monday, taking its returns for 2024 to 17%. Shares have outperformed the benchmark Nifty 50 index, which has gained 4% during the same period.

Reliance Industries continues to remain the most valued Indian company, with a market capitalisation of ₹19.8 lakh crore, software major Tata Consultancy Services (TCS) comes second with a ₹14 lakh crore market cap. India’s largest private lender, HDFC Bank has a market capitalisation of ₹11.6 lakh crore and its the only bank in India to have a market capitalisation in excess of ₹10 lakh crore.

State Bank of India, the country’s largest lender had a market capitalisation of ₹7.4 lakh crore.

Analysts continue to remain bullish on ICICI Bank’s continued balance sheet improvement. No analyst has a “sell” rating on the stock, that boasts of 94% of the analysts tracking the stock have a “buy” rating.

Brokerage firm JM Financial wrote in its note that ICICI Bank will retain its valuation premium courtesy of its best-in-class return profile. “ICICI Bank firmly remains on track to deliver 18.5% Return on Equity on average in the next two years, with asset quality in good shape and continued growth momentum,” it said.

You can read more on what analysts had to say on ICICI Bank post its earnings here.

ICICI Bank’s asset quality for the March quarter was the best in nearly a decade, while deposit growth of 19.6% year-on-year was the highest in 12 quarters.

The rally in ICICI Bank, coupled with the underperformance of Kotak Mahindra Bank has narrowed its valuation gap with the latter. At current levels, both the lenders are trading at a one-year forward price-to-book multiple of 2.9x.

Shares of ICICI Bank are trading 4.7% higher at a record high of ₹1,160. The index heavyweight also propelled the Nifty Bank to its own record high of 49,399.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow