The levels investors need

The stock trades at 2.2x FY27E and 1.9x FY28E adjusted book, and at 13.6x FY28E earnings. Motilal Oswal now pencils in FY28 return on assets of 2.4% and return on equity of 17.6%, figures the brokerage says sit "beyond aspiration for most peers" at ICICI Bank's scale.

How the quarter reconciled with the estimate

Standalone profit after tax of Rs 14,840 crore landed almost exactly where Motilal Oswal expected, up 20.1% year on year. Consolidated profit climbed 22.3% to Rs 16,330 crore. Beneath that match, a miss on other income was offset by a large saving on provisions.

Net interest income grew 17.7% to Rs 25,340 crore. Other income of Rs 8,050 crore disappointed partly because of a treasury loss of Rs 230 crore, against a gain of Rs 150 crore in the June quarter, even as core fees rose 20.1% on one-off FCNR(B) processing fees. Operating expenses rose 8.5% to Rs 12,810 crore, lifting the cost-to-income ratio to 38.4%, while core operating profit advanced 21.8% to Rs 20,810 crore.

A balance sheet moving at highway speed

Loans reached Rs 18.32 lakh crore, up 12.3% in a single quarter, while deposits rose to Rs 20.50 lakh crore. Domestic advances grew a more measured 22.8%. Within retail, mortgages grew 15.3% and personal loans 16.6%, but credit-card balances shrank 9.7% and gold loans slowed as the bank aligned processes with new RBI rules.

The dollar deposits reshaped the loan mix. The international share jumped from 3.1% to 7.8% of loans in one quarter, while the retail share fell from 56.2% to 51.6%. The CASA ratio dropped to 36.1% from 39.5% as term deposits swelled.

The FCNR(B) drive, and why margins took the hit

ICICI Bank mobilised about Rs 1.60 lakh crore (converted at about Rs 89 to the dollar) of FCNR(B) deposits. The bank itemised how two parts were funded:

The bank raised bonds to fund the leverage it extended against these deposits. That cost pushed up expenses but was largely offset by the processing fees. Net interest margin fell 18 basis points to 4.18%, or 10 basis points excluding a tax-refund interest benefit in the previous quarter. Management laid out a clear path:

Bad loans keep shrinking

Fresh slippages fell 4% year on year and 13% sequentially to Rs 4,830 crore. Net NPA eased to 0.30%, the provision coverage ratio edged up to 75.5%, and the contingency buffer held at Rs 13,100 crore, about 0.7% of loans. The bank also carries additional standard-asset provisions of Rs 1,283 crore. Management guided normalised credit cost of up to 50 basis points, after a chunky corporate recovery and higher general provisions largely cancelled out this quarter.

The group around the bank

Unlocking the Rs 1,750 target

The target is a sum of the parts. The core bank is valued at 2.5x March 2028 adjusted book, or Rs 10.66 lakh crore. The listed and unlisted ventures add Rs 2.37 lakh crore before a 20% holding-company discount. Per share, the vault opens like this:

The earnings runway

Motilal Oswal lifted its FY28 profit estimate by 3% on stronger interest income, trimming other income by 3.5% for both years. It expects earnings per share to compound at about 21% over two years.

What could spoil the thesis