On Mar 9, Zacks Investment Research upgraded ICICI Bank Ltd. (IBN) to Zacks Rank #1 (Strong Buy).
Why the Upgrade?
ICICI Bank has been witnessing rising earnings estimates owing to strong fiscal third quarter 2013 results. Moreover, this foreign bank has a long-term earnings growth forecast of 22.0%.
ICICI Bank reported fiscal third-quarter results on Jan 31. Net income came surged 30% year over year to INR22.50 billion ($409 million). Results were primarily aided by a solid top-line growth, partially offset by increases in loan loss provisions and operating expenses.
Net interest income augmented 29% from the prior-year quarter to INR27.12 billion ($493 million). Similarly, non-interest income jumped 17% to INR18.92 billion ($344 million). Operating expenses for the quarter totaled INR22.61 billion ($411 million), up 18% year over year, primarily attributable to the bank’s branch-network expansion. Provisions for the reported quarter increased 8% year over year to INR3.69 billion ($67 million).
ICICI Bank’s credit quality was a mixed bag during the quarter. As of Dec 31, 2012, net nonperforming assets were INR21.85 billion ($397 million), rising 5% from the prior-year quarter. The bank's net nonperforming asset ratio stood at 0.64%, declining 6 bps from the year-ago period.
The Zacks Consensus Estimate for fiscal 2013 increased 2.6% to $2.75 per share over the last 60 days. For fiscal 2014, the Zacks Consensus Estimate moved up by 2.5% to $3.30 per share, over the same time frame.
Other Foreign Stocks to Consider
Besides ICICI Bank, other foreign banks like Banco Bilbao Vizcaya Argentaria, S.A. (BBVA), Banco Macro S.A. (BMA) and Shinhan Financial Group Company Limited (SHG) carry a Zacks Rank #1 and are worth considering.
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