New Delhi: The ICICI Bank is open for subscription with a follow on public issue. The price band for the issue is between Rs 885 and Rs 950 per equity share.
The follow on public issue of India's second largest bank, ICICI Bank has received good response from investors especially qualified institutional investors.
The issue was subscribed 9.47 times, as per NSE website. A 9.88 crore shares issue received 93.65 crore bids, out of which 1.05 crore bids at cut off price.
Networth Stock Broking report on ICICI Bank FPO:
Company Profile
ICICI Bank is a leading Indian private sector bank offering a wide range of products and services. Its operations are across corporate and retail sector. In FY07, retail lending constituted 63.8% and retail customers’ amount to 24 million.
Corporate customers are focused towards small and middle market businesses. The bank has reach across 710 branches, 45 extension counters and 3271 ATMs.
Concerns
Any slow down in the economic growth of the country could impact the growth of the banking industry in general.
The maturity profile of deposits for ICICI Bank is less than a year and most of the bank’s credit requirements are being funded by these short-term sources. This leads to asset-liability mismatch for the bank.
Net NPA ratio witnessed marginal increase with the 34% y-o-y growth in advances from 0.71% to 0.98% due to defaults from credit cards and retail lending.
Net interest margins as on FY07 were lower than industry peers at 2.57% due to higher cost of deposits at 6.6% and marginal improvement in yields at 8.9%.
Valuation
We recommend ‘Subscribe’ to the issue from a long-term growth perspective.
Comments
0 comment