ICICI Bank shares fell 3.03% to ₹1,368.10 on Monday afternoon, despite brokerages maintaining a positive outlook following the bank's mixed third-quarter results and the announcement of CEO Sandeep Bakhshi's tenure extension. The stock traded in a range of ₹1,360-1,400 during the session, with sell orders dominating at 64.86% against 35.14% buy orders.

Trading Activity and Market Response

Trading volumes remained robust during the session, reflecting significant investor interest despite the price decline. The market reaction comes amid mixed sentiment following the bank's quarterly performance disclosure.

Financial Performance Overview

ICICI Bank reported a profit after tax of ₹11,320 crore for the third quarter, marking a decline of 4% year-on-year and 8.4% quarter-on-quarter. The decline was primarily driven by an unexpected RBI-mandated standard asset provision of ₹1,283 crore on an agri priority sector credit portfolio worth ₹20,000-25,000 crore, flagged during the regulator's annual supervisory review for non-compliance with priority sector norms.

Analysts noted that excluding one-time provisions, core pre-provisioning operating profit grew 6-7% year-on-year. Credit growth accelerated to 11.5% annually, while net interest margins remained stable at 4.30%. Asset quality stayed resilient with gross non-performing assets at 1.53%.

Positive Brokerage Outlook Despite Challenges

Leading brokerages have retained their buy ratings despite the provision impact, with several firms highlighting the board's approval of Bakhshi's two-year extension until October 2028 as a significant positive, removing a major overhang.

Anand Rathi maintained its buy recommendation with a target price of ₹1,713, valuing the core bank at 2.5 times FY28 price-to-adjusted book value. Systematix Institutional Equities raised its target to ₹1,770 from ₹1,590, while SBI Securities pegged fair value at ₹1,700-1,750.

Future Outlook and Concerns

However, concerns persist around elevated credit costs in coming quarters as the bank works toward regularising the flagged agri portfolio. The stock is currently trading at a price-to-book multiple of 3.0 times estimated book value, reflecting the market's cautious stance on near-term challenges while acknowledging the bank's strong fundamentals and leadership continuity.

HDFC Bank has outlined specific growth targets for FY27, aiming to achieve loan growth that surpasses the banking system's projected growth rate of 12%-13%. The bank's strategic framework also includes plans to optimize its loan-to-deposit ratio to a range of 85%-90%.

FY27 Growth Targets

The bank has set ambitious targets for the upcoming fiscal year, with loan growth expected to exceed the broader banking system's expansion rate. The banking system is projected to grow at 12%-13%, and HDFC Bank aims to outperform this benchmark through strategic market positioning and enhanced lending capabilities.

Strategic Balance Management

The bank's approach emphasizes maintaining a healthy balance between asset growth and liability management. By targeting a loan-to-deposit ratio of 85%-90%, HDFC Bank demonstrates its commitment to prudent risk management while pursuing aggressive growth objectives.

Market Positioning Strategy

The outlined strategy reflects HDFC Bank's confidence in its ability to capture market share in a competitive banking environment. The focus on exceeding system growth rates while maintaining optimal liquidity ratios positions the bank for sustainable expansion in FY27.

This strategic framework indicates the bank's readiness to capitalize on market opportunities while ensuring adequate funding support through disciplined liability management practices.