ICICI Bank was the subject of renewed buying today, climbing 3.5% to Rs 142.50.

In fact, gains in the scrip of the second-largest bank by assets were more pronounced earlier, up 4.5% to Rs 143.80. Decent early volumes were evident, at 2.2 lakh shares, on BSE.

The stock has moved within a range over the last few months, between  Rs 120 and Rs 150. The period was also marked by volatility. However, analysts are bullish over the stock.

The bank's focus on the retail sector, where there are very low defaults, and NPAs is one reason for the upbeat outlook over ICICI Bank.

In FY 2002-03, ICICI Bank achieved market leadership across products in the retail finance segment. The bank made retail loan disbursements of about Rs 20,300 crore , including home loan disbursements of Rs 8,660 crore.

The retail assets increased by over Rs 13,000 crore to Rs 19,132 crore. Retail assets now constitute 18% of total assets and 30% of customer assets compared to 6% of total assets and 11% of customer assets in March 2002.

Currently,  ICICI  Bank is one of the frontrunners in the  housing  finance sector with a 30% market share. As against the monthly (March 2003) industry  volume of Rs 3,500 crore, ICICI Bank's portfolio was at  Rs  1,070 crore. 

In  the  fiscal  ended 31 March 2003,  ICICI  Bank's  housing  loan portfolio  was  Rs 9,220 crore, reflecting 48.2% of  the total retail portfolio of Rs 19,132 crore.

The Securisation Act has come as a big booster for the whole banking sector. The Securitisation Act aims at speeding up recovery of sticky assets without additional court procedures. The Securitisation Act augurs well for the lending business as it will reduce incremental non-performing assets (NPAs) i.e. willful defaults by borrowers may come down drastically.

However, a court case is pending as to whether banks would be able to dispose off assets of defaulting borrowers. Pending this clarification, not much recovery is taking place on the corporate recovery front, banking analysts said.

As on 31 March 2003, ICICI Bank's net non-performing customer assets were Rs 3,151 crore constituting 4.9% of customer assets, while gross non-performing assets were about Rs 5,900 crore constituting 8.5% of customer assets.

The bank's standard assets included net restructured assets stood at Rs 8,943 crore. The bank had a provision coverage of about 62% against non-performing assets. Its capital adequacy ratio (CAR) was 11.1% (including Tier-1 capital adequacy of 8.2%), well above RBI's requirement of 9%.

ICICI Bank was transformed into a universal bank with the merger of the erstwhile ICICI along with its subsidiaries, ICICI Personal Financial Services and ICICI Capital Services w.e.f. 30 March 2002.

For FY 2002-03, ICICI Bank posted a net profit of Rs 1,206.18 crore (Rs 258.30 crore) on total income of Rs 12,526.88 crore (Rs 2,726.59 crore). The results for the year ended 31 March 2003 include the results of the erstwhile ICICI and its subsidiaries ICICI Personal Financial Services and ICICI Capital Services, amalgamated with ICICI Bank with effect from 31 March 2002, and are therefore not comparable.