ICICI Bank Q1 Results: Net profit jumps 15% on-year to Rs 12,768 crore, beats Street estimate

Mumbai, July 19, 2025 —
ICICI Bank, India’s second-largest private sector lender, reported a robust 15% year-on-year (YoY) growth in consolidated net profit for the quarter ended June 30, 2025, reaching ₹12,768 crore. The figure surpassed Street estimates, buoyed by higher net interest income (NII), improved asset quality, and sustained loan growth across retail and SME segments.

The bank's performance reinforced investor confidence, with shares closing nearly 2.1% higher on the Bombay Stock Exchange following the results announcement.

Key Highlights: ICICI Bank Q1 FY26 Financials

• Consolidated Net Profit: ₹12,768 crore, up 15% YoY

• Standalone Net Profit: ₹11,979 crore, compared to ₹10,636 crore in Q1 FY25

• Net Interest Income (NII): ₹20,984 crore, up 13% YoY

• Net Interest Margin (NIM): 4.48%, stable compared to the previous quarter

• Gross NPA Ratio: 2.67% vs. 2.76% in Q4 FY25

• Provisions: ₹964 crore, down 8% YoY

• Loan Book Growth: 16.4% YoY

• CASA Ratio: 42.3%, slightly lower from 43.1% YoY

Retail and SME Lending Continue to Drive Growth

ICICI Bank's loan portfolio saw steady expansion during the quarter, driven by retail and SME lending. Retail loans grew 18% YoY, while the SME segment expanded by 22%. Corporate lending also witnessed moderate growth at 11% YoY, with management highlighting improved demand from infrastructure and renewable energy sectors.

“We’re seeing healthy traction in personal loans, credit cards, and home loans. Digital origination now accounts for over 80% of our retail disbursements,” said Sandeep Batra, Executive Director, ICICI Bank, during the post-results briefing.

Asset Quality and Provisioning

The bank demonstrated further improvement in asset quality. Gross non-performing assets (GNPA) declined to 2.67% from 2.76% in the previous quarter, while net NPAs also declined marginally to 0.44%. The provision coverage ratio remained robust at 81.6%.

“We remain cautious but confident about credit quality, especially as macroeconomic indicators stabilize,” Batra added.

Provisions for the quarter fell to ₹964 crore, reflecting improved recoveries and lower slippages, particularly in the corporate segment.

Analyst Views and Market Reactions

Analysts largely applauded the bank’s performance and emphasized its balance sheet resilience.

“ICICI Bank’s earnings beat is supported by stable margins, contained provisions, and consistent retail loan growth. The bank remains well-positioned to benefit from India’s credit upcycle,” said Neeraj Sinha, Banking Analyst at Motilal Oswal Financial Services.

Brokerages like Jefferies, CLSA, and Kotak Institutional Equities reiterated a 'Buy' rating on the stock, raising the target price in the range of ₹1,270–1,350.

The ICICI Bank stock ended the day at ₹1,218.65 on the NSE, up 2.1%, outperforming the Nifty Bank index which closed 0.9% higher.

Digital Push and Cost Efficiency

The bank’s ongoing investments in digital transformation continued to yield results. Over 94% of savings account transactions and 99% of fixed deposit transactions were completed digitally. The bank also noted that its AI-enabled platforms are enhancing customer engagement and reducing operational costs.

Operating expenses rose modestly by 8% YoY, while the cost-to-income ratio improved to 38.2%, down from 39.4% in Q1 FY25.

Macroeconomic Context and Sector Outlook

ICICI Bank’s strong results come amid an improving macroeconomic backdrop. With the Reserve Bank of India (RBI) expected to maintain a prolonged pause on interest rates, lending activity is likely to remain steady.

“Rate stability and fiscal optimism are tailwinds for the banking sector. ICICI is well-leveraged to capture this momentum,” said Anjali Verma, Senior Economist at PhillipCapital.

Credit growth for the industry stood at around 14.9% YoY as per the RBI’s latest data. Analysts expect this to stay in double digits in the coming quarters, led by continued demand in retail and MSME segments.

Investor Outlook

ICICI Bank’s solid Q1 performance provides a strong foundation for FY26. The bank’s healthy return ratios, strong asset quality, and prudent provisioning make it a top choice among private lenders for institutional and retail investors alike.

With a return on assets (RoA) of 2.4% and return on equity (RoE) of 17.6% for the quarter, the bank continues to deliver industry-leading performance.

“We expect ICICI Bank to maintain a steady earnings trajectory with a focus on profitability and digital innovation. Any dip in the stock remains a buying opportunity,” stated a report from Axis Capital.

ICICI Bank’s Q1 FY26 results underscore its strength in navigating a complex financial landscape with consistent earnings growth, robust credit underwriting, and digital acceleration. As India’s economic outlook brightens, the bank is well-equipped to deepen its market leadership and generate long-term value for its stakeholders.