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ICICI posts outstanding financial performance - Views on News from Equitymaster
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  • Apr 28, 2000

    ICICI posts outstanding financial performance

    India's leading financial institution ICICI has reported a 21% jump in its net profits to Rs 12,060 m for the FY00 over the previous period, notwithstanding the enhanced provision and write-offs by 44% to Rs 6,900 m.

    During the year, ICICI consolidated its presence in retail asset business with market share gains in home loans, auto loans and consumer durable loans.

    ICICI's approvals increased by 37% to Rs 444.8 bn and disbursements went up by 34% to Rs 258.3 bn in FY00 compared to FY99. Infrastructure and Oil & Gas sectors aggregated 42% and 36% of approvals and disbursals respectively.

    ICICI's net NPA ratio declined to 7.6% as on March 2000 compared to 8.1% in the last year. Lower exposure to manufacturing loans could be one of the reason for decline in the ratio. Also an industrial recovery from cyclical downturn of the previous two years helped the company in settling of its past dues.

    Total capital adequacy ratio (CAR) of ICICI increased to 17.1% as on March 2000 as compared to 12.5% in the previous year due to successful completion of its three tier equity offering.

    Snapshot of performance of subsidiaries in FY00 over the previous year:

    • ICICI Bank's net profits increased by 66% to Rs 1,050 m.
    • ICICI Securities' profits jumped up by 263% to Rs 720 m.
    • ICICI Infotech's net profits grew by 249% to Rs 110 m.
    • ICICI Venture registered a 500% rise in profits to Rs 380 m.

    At the current market price of Rs 133 ICICI is available at a P/E of 9 times its FY00 earnings on a market cap to sales ratio of 1.2 times. ICICI enjoys the highest valuations amongst the financial institutions due to its premium brand and quality of services provided by it.

    (Rs m) FY1999 FY2000 Change
    Income from Operations 73,440 86,320 17.5%
    Other Income 920 550 -40.2%
    Interest & Depreciation 56,380 63,720 13.0%
    Operating Profit (EBDIT) 17,060 22,600 32.5%
    Operating Profit Margin (%) 23.2% 26.2%  
    Other Expenses 2,240 2,970 32.6%
    Provisions & write-offs 4,780 6,900 44.4%
    Profit before Tax 10,960 13,280 21.2%
    Tax 950 1,220 28.4%
    Profit after Tax/(Loss) 10,010 12,060 20.5%
    Net profit margin (%) 13.6% 14.0%  
    Earnings per share* 20.85 15.40  



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