ICICIBANK

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

By Shritama Bose

MUMBAI, Feb 19 (Reuters Breakingviews) - India’s dealmakers are celebrating their arrival on the global map. Last year, Kotak Mahindra Bank KTKM.NS not only topped LSEG's league table for initial public offerings in Asia by volume, edging out CITIC 0267.HK and JPMorgan JPM.N, but it also broke into the ranks of the top 10 underwriters of common stock deals globally by proceeds. Both are firsts for an Indian investment bank. But the strong showing by the $45 billion firm and its compatriots may prove hard to sustain.

A record $71 billion in equity fundraising powered the South Asian country's climb past China and Hong Kong to the spot of the world’s second-largest destination for share placements behind the U.S. last year, per Dealogic data. New-economy companies including Swiggy SWIG.NS and Ola Electric Mobility OLAE.NS going public were a lynchpin for strong fees. Meanwhile, punchy valuations prompted global businesses like Whirlpool WHR.N to cash out stakes in their local units and Hyundai Motor 005380.KS to take its Indian business public.

It spelt a bonanza for banks like Kotak and ICICI Bank ICBK.NS, both of which trade at 3 times forward book value, the top of their peer group. Their rise up the league tables buys them credibility beyond those rich valuations.

The mood is upbeat. At a Mumbai conference of investment banks in January, a singer belted out chest-thumping patriotic numbers in the presence of Madhabi Puri Buch, chief of Securities and Exchange Board of India, the capital markets regulator. Sundararaman Ramamurthy, the CEO of BSE BSEL.NS, one of the country’s two main stock exchanges, described the IPO boom as a moment of India’s “re-emergence” on the world stage.

The pipeline remains strong. Kotak has won a mandate, alongside Morgan Stanley MS.N, for what could be India's largest ever IPO, an up to $4.6 billion listing of Reliance Industries' RELI.NS telecommunications business, IFR reported in January, citing unnamed people. HDFC Bank’s HDBK.NS shadow lending unit has filed for a $1.44 billion float. Businesses ranging from the local unit of South Korean consumer appliances giant LG Electronics 066570.KS to Tiger Global-backed stockbroker Groww are preparing for billion-dollar listings too, per IFR. Kotak expects primary fundraising in India to rise 59% from last year’s level to $35 billion in 2025.

But the broader environment is less cheery. Foreign portfolio investors are dumping Indian shares and companies are reporting dismal earnings, pulling indexes off last year’s dizzying highs. The outlook for GDP growth is sombre. Beijing's push for higher-valued startups could rejuvenate dealmaking in China this year, and Hong Kong listings are rebounding from a 20-year low. The two centres notched up a total $132 billion in equity transactions in 2023 before markets slumped.

Kotak and its peers may find their dealmaking crown was easier to earn than to hold.

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CONTEXT NEWS

Kotak Mahindra Bank was the 10th largest bookrunner globally for common stock deals by proceeds in 2024, with a 1.5% share of the market, according to LSEG data. It also topped the league table for Asian initial public offerings, including Chinese A-shares, facilitating listings that raised $2 billion during the year.

(Editing by Antony Currie and Aditya Srivastav)

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Feb 18 (Reuters) -

• ICICI IS SAID TO WEIGH BUYING ADDITIONAL STAKE IN PRUDENTIAL JV - BLOOMBERG NEWS

• ICICI MAY SEEK TO BUY ABOUT 3% IN THE VENTURE FROM ITS PARTNER PRUDENTIAL - BLOOMBERG NEWS

Source text: https://tinyurl.com/bdf2u5pw

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** ICICI Bank ICBK.NS will gain about 3% from the last close of 1,253 rupees, if ICICI Prudential Asset Management Company (AMC), says Macquarie

** British insurer Prudential PRU.L is considering listing ICICI Prudential AMC, its JV with ICICI Bank

** Media reports suggest Prudential plans to sell 10% stake for 100 billion rupees ($1.15 billion)

** A listing will also add 2% to Macquarie's fair value on ICICI Bank of 1,670 rupees, already the highest among the 39 analysts covering the stock

** Brokerage keeps "outperform" rating

** Analysts' average rating is a "buy" and their PTs range from 1,290 rupees to 1,670 rupees - LSEG data

** ICBK has shed 1.7% YTD, mirroring benchmark Nifty 50 .NSEI's drop

($1 = 86.8640 Indian rupees)

(Reporting by Bharath Rajeswaran in Bengaluru)

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Writes through, adding detail, ICICI statement, share price reaction and background

Feb 12 (Reuters) - British insurer Prudential PRU.L is considering listing its Indian joint venture ICICI Prudential Asset Management, it said on Wednesday.

Prudential's London-listed shares soared more than 8%, buoyed by plans that would involve the company divesting some of its 49% stake in the Indian asset manager and returning the proceeds to shareholders.

ICICI Prudential Asset Management offers a range of mutual fund products in India. ICICI Bank ICBK.NS, India's second-largest private lender by assets, holds the other 51% stake in the joint venture.

"We intend to retain our majority shareholding in ICICI Prudential Asset Management Company, ensuring our long-term commitment," ICICI Bank said in a stock market filing after Prudential's announcement.

Prudential did not disclose where it plans to list the company, but any potential listing would be subject to market conditions and approvals, it said.

"It is intended that following the completion of such a divestment, the net proceeds would be returned to shareholders," the British company added.

India's initial public offering (IPO) market had a record run in 2024 and the capital-raising spree is expected to continue this year given the pipeline of companies looking to go public, the CEO of BSE, the country's oldest exchange, told Reuters last month.

The IPO boom in India was driven by offers for sale (OFS), where large shareholders sell existing shares to reap the proceeds themselves rather than new issues that provide companies with capital to invest, BSE's Sundararaman Ramamurthy had said.

(Reporting by Yadarisa Shabong and Nishit Navin in Bengaluru
Editing by Shinjini Ganguli and David Goodman)

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MUMBAI, Feb 11 (Reuters) - India's ICICI Home Finance ICICH.UL has accepted bids worth 6 billion rupees ($69.1 million) for bonds maturing in three years and two months and in five years, three bankers said on Tuesday.

The company will pay an annual coupon of 7.81% and 7.76% on these issues, respectively, and had invited bids from bankers and investors earlier in the day, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on February 11:

* Size includes base plus greenshoe for some issues

($1 = 86.8975 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Eileen Soreng)

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MUMBAI, Feb 10 (Reuters) - India's ICICI Home Finance ICICH.UL plans to raise 6 billion rupees ($68.6 million), including a greenshoe option of 1.50 billion rupees, through the sale of bonds maturing in three years and two months as well as in five years, three bankers said on Monday.

The company will pay an annual coupon of 7.81% and 7.76% on these issues respectively, and has invited bids from bankers and investors on Tuesday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on February 10:

*Size includes base plus greenshoe for some issues


($1 = 87.4220 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Savio D'Souza)

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** ICICI Bank on Saturday posted a 14.8% rise in net profit to 117.92 billion rupees ($1.37 billion) for October-December quarter, helped by healthy loan growth and net interest income

** At least 8 analysts raised PT on ICBK after results, with median PT at 1,490 rupees vs 1,462 rupees, a month back - LSEG data

INDUSTRY LEADING GROWTH

** CLSA ( "outperform"; PT 1,600 rupees) says results should alleviate concerns of asset quality fear, stock is not only a safe haven in this macro environment, but also a good compounder

** Ambit Capital ("buy"; PT 1,459 rupees) says ICICI Bank continues to deliver on what matters in the current environment like asset quality; co best in sector with net slippages of 85 bps vs average 105 bps for peers

** PhillipCapital ("buy"; PT 1,520 rupees) says bank well poised to gain market share when large private banks are moderating growth

(Reporting by Sethuraman NR)

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MUMBAI, Jan 25 (Reuters) - ICICI Bank ICBK.NS, India's second-largest private lender by assets, reported higher quarterly profit on Saturday, helped by healthy loan growth and net interest income, although its lending margins shrank.

The bank's standalone net profit rose 14.8% to a record 117.92 billion rupees ($1.37 billion) in the October-December quarter, above the average analyst forecast of 114.94 billion rupees, according to data compiled by LSEG.

ICICI Bank's total loans rose 13.9% from the same period a year earlier, while deposits grew by 14.1%. Net interest income, the difference between interest earned on loans and paid on deposits, increased by 9.1% to 203.71 billion rupees.

Indian banks have enjoyed double-digit loan growth, led by strong retail demand. But they are scrambling to raise deposits to meet credit growth needs, which has led them to either raise rates on deposits or scale back loan growth, in turn squeezing margins.

ICICI Bank's net interest margin, a key gauge of profitability, fell to 4.25% from 4.43% a year earlier and from 4.27% in the previous quarter.

Provisions and contingencies, the funds set aside for potential bad loans, rose nearly 17% to 12.27 billion rupees from 10.49 billion rupees a year earlier.

Other Indian banks, including Kotak Mahindra Bank KTKM.NS, HDFC Bank HDBK.NS and RBL Bank RATB.NS, all raised provisions in the third financial quarter due to stress in unsecured, agriculture and microfinance loans.

ICICI Bank's asset quality was largely stable, with the gross non-performing assets (NPA) ratio at 1.96% at the end of December, versus 1.97% three months earlier.

The bank typically experiences higher NPA additions from the kisan credit card portfolio, a credit scheme for farmers in India, during the first and third financial quarters, ICICI said in a release.

Shares of ICICI Bank ended 0.6% higher ahead of the results on Friday.

($1 = 86.2000 Indian rupees)

(Reporting by Siddhi Nayak in Mumbai; Editing by William Mallard)

(([email protected]; +91 22 6921 7848; X: https://twitter.com/siddhiVnayak))

• ICICI Bank Ltd IBN.N, IBN is expected to report resultson January 25 for the period ending December 31 2024

• 
  

• ​LSEG's mean analyst estimate for ICICI Bank Ltd is for earnings of 37 cents per share.

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 4 "strong buy" or "buy," no "hold" and no "sell" or "strong sell."

• The mean earnings estimate of analysts was unchanged in the last three months. ​

• Wall Street's median 12-month price target for ICICI Bank Ltd is $35.75​, above​ its last closing price of $27.55. ​​​

This summary was machine generated January 23 at 11:01 GMT. All figures in US dollars unless otherwise stated. (For questions concerning the data in this report, contact [email protected]. For any other questions or feedback, contact [email protected])

Jan 21 (Reuters) - India's ICICI Prudential Life Insurance ICIR.NS reported a 43% jump in third-quarter profit on Tuesday, driven by higher premiums from new policy sales.

The life insurer reported a standalone profit of 3.26 billion rupees (about $38 million) for the quarter ended Dec. 31, compared to 2.27 billion rupees a year ago.

Its net premium income grew 23.5% to 12.26 billion rupees, driven by a 78% jump in single premiums or new policy sales.

Insurance awareness has been historically low in India, a country of more than 1.4 billion people, but the sector has seen rapid growth in recent years, particularly since the COVID-19 pandemic.

ICICI Prudential's larger peers HDFC Life Insurance HDFL.NS and SBI Life Insurance SBIL.NS reported strong third-quarter profits as well, on the back of strong retail insurance policy sales.

ICICI Prudential's value of new business (VNB), or expected profit from new policies, rose 8.5% year-on-year to 15.75 billion rupees for the nine months to the end of December.

Annualised premium equivalent (APE) sales, the annualised total value of all single- and recurring-premium policies, jumped 27% to 54.30 billion rupees for the nine-month period.

Insurers generally report cumulative data for metrics such as VNB and APE.

However, VNB margins slipped to 22.8% from 26.7% last year, due to a higher share of market- or unit-linked insurance plans (ULIP), which have a lower profit margin compared to term policies, the company said.

ULIPs accounted for 50.8% of its overall product mix by APE, up from 43.1% a year ago.

($1 = 86.5670 Indian rupees)

(Reporting by Nandan Mandayam in Bengaluru; Editing by Varun H K)

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Jan 17 (Reuters) - India's ICICI Lombard General Insurance ICIL.NS beat third-quarter profit estimates on Friday, helped by higher premiums earned in its health and motor insurance segments.

The insurer reported profit after tax of 7.24 billion rupees ($83.6 million) for the quarter ended Dec. 31, up 68% on-year. Analysts, on average, expected a profit of 6.10 billion rupees as per data compiled by LSEG.

India's insurance sector has seen rapid growth in recent years, with a rise in improved awareness following the COVID-19 pandemic and rising medical costs.

The country's general insurance industry is projected to grow to about $57 billion in 2028 from $40 billion in 2024 in terms of gross written premiums, according to data and analytics firm GlobalData.

ICICI Lombard's premiums earned in its retail health insurance and corporate health insurance units grew nearly 25% and 12%, respectively.

Motor insurance premiums, ICICI's largest segment, grew 17% to 25.60 billion rupees.

While sale of new vehicles were muted in the last few quarters, analysts said that ICICI Lombard's auto segment has seen growth driven by old vehicles' insurance.

The company did not give a breakdown of premium earned from insurance of new and old vehicles.

The company's net premiums earned rose 17% to 50.45 billion rupees, while income from investments rose 23%.

Combined ratio, an insurance company's losses and expenses divided by the premium it earned, eased to 102.7% from 103.6% a year earlier.

A lower ratio indicates the insurer is earning more through premiums in relation to its claims paid and operating expense incurred. ICICI Lombard's claims paid rose 19% year-on-year.

Shares of the company ended 2.1% higher ahead of the results.

($1 = 86.5720 Indian rupees)

(Reporting by Nishit Navin in Bengaluru; Editing by Varun H K)

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MUMBAI, Jan 15 (Reuters) - India's ICICI Home Finance ICICH.UL has accepted bids worth 4 Indian rupees ($46.3 million) for bonds maturing in five years, three bankers said on Wednesday.

The company will pay an annual coupon of 7.77% on this issue and had invited bids from bankers and investors earlier in the day, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Jan. 15

*Size includes base plus greenshoe for some issues

($1 = 86.4790 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Sonia Cheema)

(([email protected]))

MUMBAI, Jan 13 (Reuters) - India's ICICI Home Finance ICICH.UL plans to raise 5 billion rupees ($57.8 million), including a greenshoe option of 1.75 billion rupees, by selling bonds maturing in five years, three bankers said on Friday.

The company has invited bids from bankers and investors on Wednesday, they said.

Here is the list of deals reported so far on Jan. 13:

*Size includes base plus greenshoe for some issues

($1 = 86.5800 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Sonia Cheema)

(([email protected]))

MUMBAI, Dec 18 (Reuters) - India's ICICI Prudential Life Insurance ICIR.NS has accepted bids worth 10.40 billion rupees ($122.5 million) for subordinated bonds maturing in 10 years, two merchant bankers said on Wednesday.

The private insurer will pay an annual coupon of 8.03% on this issue and had invited bids from bankers and investors for its debut bond offering earlier in the day, the bankers added.

The bonds have a call option at the end of five years and every year thereafter.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Dec. 18:

*Size includes base plus greenshoe for some issues

($1 = 84.9230 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Eileen Soreng)

(([email protected]))

MUMBAI, Dec 16 (Reuters) - India's ICICI Prudential Life Insurance ICIR.NS plans to raise 14 billion rupees ($165.03 million), including a greenshoe option of 2 billion rupees, through the sale of subordinated bonds maturing in 10 years, two merchant bankers said on Monday.

The private insurer has invited bids from bankers and investors for its debut bond offering on Wednesday, the bankers added.

The bonds have a call option at the end of five years.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Dec. 16:

*Size includes base plus greenshoe for some issues

($1 = 84.8330 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Editing by Abinaya Vijayaraghavan)

(([email protected]))

By Dharamraj Dhutia

MUMBAI, Dec 11 (Reuters) - Indian government bond yields may trend in a narrow range in the near term, but the benchmark bond yield could ease to levels seen three years ago if the central bank cuts interest rates in its next policy meeting, the treasurer at ICICI Bank said.

"I expect 10-year benchmark bond to trade in the 6.70%-6.80% range in the near future. Going into the next year, if there is a potential rate cut in February, then we can see the 10-year yield reaching 6.60%," B Prasanna, head of treasury at the private lender, said.

Prasanna expects a shallow monetary easing cycle of 50 basis points, with a 25-basis-point reduction in February, and a similar one in April or June.

India's 10-year benchmark bond yield IN067934G=CC was at 6.71% on Wednesday, off last week's low of 6.65%. It was last at 6.60% in January 2022.

Earlier this month, the Reserve Bank of India (RBI) held interest rates but infused liquidity through a reduction in banks' cash reserve ratio.

Sanjay Malhotra, a career civil servant, takes charge as the governor of India's central bank on Wednesday, which has led traders to ramp up rate cut bets.

Prasanna said the RBI will be prepared to conduct more actions to infuse durable liquidity into the banking system as liquidity could tighten because of a rise in currency in circulation and the possibility of foreign exchange outflows.

"They (RBI) might have to use core liquidity tools like FX buy-sell swaps and open market bond purchases apart from long-term repos," he said.

"I am sure they will look at evolving liquidity scenario and new measures including OMO (open market operations) purchases would be announced as and when required."

India's banking system liquidity surplus in December has shrunk by 60% from the previous month to around 560 billion rupees ($6.60 billion).

($1 = 84.8420 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Mrigank Dhaniwala)

(([email protected];))

By Dharamraj Dhutia

MUMBAI, Dec 5 (Reuters) - India's ICICI Prudential Life Insurance expects Indian government bond yield curve to steepen, and is running a weighted average duration of around seven years in its debt portfolio, a fund manager said.

"Within the sovereign portfolio, we prefer the liquid 10-year bond, 15-year bond and long bonds of 30-to-50-year maturity," said Vidya Iyer, Head - Fixed Income, ICICI Prudential Life Insurance Co.

"Long bonds tend to do well in the last quarter of the year as that is the period when long-term investors get decent flows into their funds"

Government securities account for about 65% of Iyer's debt portfolio, with the remaining 35% in corporate bonds of up to 5 years from a carry perspective.

The fund house manages debt assets worth 1.65 trillion rupees ($19.48 billion) as of end-October.

The insurer remains constructive on Indian bonds from a medium- to long-term perspective and expects the 10-year benchmark bond yield IN067934G=CC to ease to 6.50% by end of March, from 6.68% on Thursday.

POLICY EXPECTATIONS

On the Reserve Bank of India's monetary policy expectations, Iyer said weaker growth data has opened up room for rate cuts, but believes that the need of the hour is some sort of liquidity infusion more than the repo rate cut.

"We expect the RBI to cut Cash Reserve Ratio (CRR) by 50 basis points...Given the fact that we are still above the pre-pandemic levels of 4% on CRR, the case for a CRR cut becomes even stronger."

Easier liquidity conditions will bring down market interest rates even without a direct policy rate cut.

The RBI policy decision is due on Friday. Iyer, however, expects a 25-basis-point rate cut in February policy.

"Given that inflation is still well above the RBI's comfort level, we think the RBI will wait out for couple of more readings on inflation before embarking on the rate cut cycle."

($1 = 84.7230 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Janane Venkatraman)

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Moves position of 'to India' in paragraph 7, no other changes

By Rishika Sadam and Siddhi Nayak

Nov 28 (Reuters) - Indian banks are reviewing their Adani exposure and whether they need to tighten due diligence, eight bankers said on Thursday, after the group's billionaire founder Gautam Adani was indicted by U.S. authorities over an alleged $265 million bribery scheme.

Adani Group's listed stocks, which at one point saw as much as $34 billion wiped off their market value, meanwhile recovered ground as some partners and investors rallied behind it.

State Bank of India SBI.NS will not stop lending to ongoing Adani projects that are nearing completion, two sources told Reuters, but will exercise caution when disbursing loans to ensure all terms and conditions are being met.

Bank of India BOI.NS, Union Bank UNBK.NS, ICICI Bank ICBK.NS, Canara Bank CNBK.NS, IDBI Bank IDBI.NS and RBL Bank RATB.NS, which have relatively smaller exposures to the Adani Group, are undertaking similar exercises, sources said.

A regulatory source aware of the development said from a banking system perspective that no entity was over-exposed to the Adani group and there was no cause for concern.

Earlier on Thursday, Israel said it wants Adani Group to continue to invest there, adding that the U.S. allegations were not "problematic" from its perspective.

"We wish Adani and all Indian companies continue to invest in Israel," Israel's Ambassador to India Reuven Azar told Reuters in an interview.

The Adani Group holds a 70% stake in Haifa port in northern Israel and is involved in projects with Israeli firms, including manufacturing military drones and commercial semiconductors.

Adani and seven others are accused by U.S. authorities of being part of a scheme to pay bribes to secure Indian power supply contracts. The Adani Group has denied the allegations.

The Indian ports-to-power conglomerate has also received public backing from Abu Dhabi's International Holding IHC.AD, which maintained its outlook on investments in the group.

"Our partnership with the Adani Group reflects our confidence in their contributions to the green energy and sustainability sectors," IHC said on Wednesday, adding that it "continues to evaluate relevant information and developments".

IHC, which is one of Adani's key foreign investors, boosted its stake in the group's Adani Enterprises ADEL.NS flagship to more than 5% last year after selling down investments in Adani Green Energy ADNA.NS and Adani Energy Solutions ADAI.NS.

Shares in Adani Green, the company at the centre of the bribery allegations, rose by 10% on Thursday, hitting the cap on gains in a single session for a second consecutive day, with Adani Energy also up the maximum 10%.

The total losses in the value of Adani Group's 10 listed companies have narrowed to $14.5 billion from about $34 billion, the low reached on Tuesday after the U.S. indictments.

FALLOUT

Global investors say worries of a wider spillover from the Adani allegations will hurt sentiment in India, but not the long-term outlook, as they wager one of the world's best-performing markets will get back on track next year.

Investors expect a stronger spotlight on governance and disclosure, and perhaps some volatility, but say the affair has not challenged the reasons they are in India in the first place - for exposure to a growing economy and a huge consumer market.

Indian Prime Minister Narendra Modi's government has not commented on the allegations against the Adani Group and has blocked opposition party demands for a debate on them.

Both houses of India's parliament were suspended temporarily within minutes of opening on Thursday as opposition lawmakers disrupted proceedings for the third day over the issue.

Many opposition parties accuse Modi and his Bharatiya Janata Party (BJP) of favouring Gautam Adani and blocking investigations against him, charges which both have denied.

The Adani Group, which is among India's biggest business empires, has been under scrutiny since January 2023 short seller Hindenburg Research accused it of stock manipulation, which the group has denied, and questioned its high debt levels.

Adani Green said on Wednesday that Adani had been charged by U.S. Securities and Exchange Commission (SEC) for alleged violations of securities law and faced potential fines but had not been charged under the U.S. Foreign Corrupt Practices Act.

The civil action launched by the SEC runs in parallel to U.S. federal prosecutors' indictment against Adani and others.

Repercussions from the indictment have mounted for the Adani Group over the past week, with credit ratings agencies cutting the outlook for some of the listed companies' bonds.

French oil major TotalEnergies TTEF.PA, said on Monday it would not make any more investments in the Adani Group until there was clarity over the allegations and consequences. Total has a 20% stake in Adani Green.

Kenya has scrapped a $2 billion procurement project that was to give Adani control of the country's main airport and it shelved a 30-year, $736-million public-private partnership, signed by Adani Energy with its energy ministry in October.

Closer to home, Sri Lanka said it would investigate all Adani-related projects in the island nation, while Bangladesh is investigating power generation contracts signed under the previous prime minister, one of which was with Adani Power.

(Reporting by Hadeel Al Sayegh in Dubai, Shilpa Jamkhandikar in Mumbai and Nigam Prusty in New Delhi; Writing by Scott Murdoch, Chris Thomas; Editing by Alexander Smith)

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The authors are Reuters Breakingviews columnists. The opinions expressed are their own. Updates throughout with new financial numbers released by the company.

By Shritama Bose and Una Galani

MUMBAI, Nov 25 (Reuters Breakingviews) - Gautam Adani has put India on the spot. The country’s government may need to nudge local lenders to support the growth of the billionaire’s infrastructure conglomerate after the United States filed criminal charges against him. Such a decision, though, would come at a big cost.

One of the biggest borrowers in the world’s fifth-largest economy faces sweeping risks after U.S. prosecutors accused the tycoon of bribing Indian government officials through Adani Green Energy ADNA.NS, one of his 11 Mumbai-listed companies including the flagship, Adani Enterprises. Adani Group called the charges “baseless” and denied them.

Containing the financial fallout will be hard because the tycoon tightly controls all his businesses. For now, his group has a strong cushion. Though total borrowings doubled to $31 billion in the past five years, its cash balance grew faster and was equivalent to nearly 21% of gross debt as of September. That gives the group capacity to pay interest and maturing debt for about 28 months, by its own calculations.

Overseas lenders are likely to be the most cautious. Global capital markets, which supplied 23% of Adani’s existing debt, are probably closed for now. Last week, Adani Green Energy cancelled a $600 million offshore bond sale.

Foreign banks, among them Barclays BARC.L, Emirates NBD ENBD.DU and Mizuho 8411.T, account for a further 27% of borrowings. While most loans are secured by cash-generating assets, lenders may lower funding limits, try to recall loans, or decide not to renew borrowing facilities or U.S. hedging contracts.

That puts the focus on Indian institutions. Domestic banks are on the hook for 42% of the group’s debt and finance most of its working capital. They will probably await a signal from New Delhi before making decisions on how to proceed. Prime Minister Narendra Modi has not yet commented on the saga.

India's regulator requires that banks limit their exposure to any single business group to 25% of their eligible Tier 1 capital. This stood at a collective $258 billion in September, according to rating agency ICRA. If the industry utilised the full limit, it could lend up to $65 billion – more than double the conglomerate’s total borrowings.

However, private lenders like HDFC Bank HDBK.NS and ICICI Bank ICBK.NS may be less ready to chip in than government-controlled institutions like State Bank of India SBI.NS. And most banks prefer to stay well below the cap on single exposures.

Whatever happens, Adani will almost certainly face higher borrowing costs because agencies are lowering some outlooks in response to the indictment. But that looks manageable too: increasing its financing costs by two percentage points to around 10% would require an additional $612 million outlay each year. The group builds a much higher buffer into its financial planning.

Adani also has capacity to fund its own operations. It generated EBITDA – a proxy for cash flow – of about $10 billion in the year to the end of March. It needs to spend that much every year to hit its target of investing $100 billion over the next decade. That implies it could probably afford to maintain its investment in airports, logistics, and the energy transition – including a 40-gigawatt renewable energy plant in Gujarat, billed as the world’s largest. If needed, the group could reduce the pace of growth in other areas such as commercial mining or materials.

One danger is that the indictment prompts other state governments in India or overseas to scrutinise their contracts with the group. There is no broader sign of that yet, though a U.S. agency that agreed to lend more than $500 million to an Adani Group-backed port development in Sri Lanka said it’s still conducting due diligence on the project. Some Indian bankers hope the incoming U.S. government of President-elect Donald Trump will refrain from seeking to extradite Gautam Adani. Alternatively, the tycoon could agree a settlement that would eventually allow his empire back into global markets.

Adani and the Indian government may ultimately prefer the country’s core infrastructure to be funded domestically. But India’s financial markets are probably not deep enough to make that comfortable. Besides, the country spent years cleaning up after a bad debt crisis at its banks, and officials have since tried to reduce how much they meddle in lending decisions. If they now order banks to up their exposure to a group waving a large red flag, it will represent a backward step.

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CONTEXT NEWS

U.S. bribery charges against Indian billionaire Gautam Adani are linked to one contract of Adani Green Energy comprising some 10% of its business, and none of the conglomerate's other companies are accused of wrongdoing, the group's chief financial officer, Jugeshinder Singh, said on Nov. 23. The company will respond in the fullness of time after reviewing the matter as presented in the legal filings, he added.

U.S. prosecutors on Nov. 20 charged the Adani Group’s patriarch with committing securities and wire fraud between 2020 and 2024. They allege that he and seven other defendants, including his nephew Sagar Adani, agreed to pay some $265 million in bribes to Indian government officials to win solar-power contracts that were expected to generate around $2 billion in profit over 20 years for Adani Green Energy. The next day, Adani Group called the charges against the directors of its renewable energy unit “baseless” and denied them.

(Editing by Peter Thal Larsen and Ujjaini Dutta)

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MUMBAI, Nov 22 (Reuters) - India's ICICI Home Finance plans to raise 6 billion rupees ($71.04 million), which includes 1.50 billion rupees from a greenshoe option, by selling bonds maturing in three years and three months and in 10 years, three bankers said on Friday.

The company invited bids from bankers and investors on Monday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Nov. 22

*Size includes base plus greenshoe for some issues

($1 = 84.4640 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Abinaya Vijayaraghavan
Editing by)

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MUMBAI, Nov 13 (Reuters) - India's central bank on Wednesday said the State Bank of India SBI.NS, HDFC Bank HDBK.NS and ICICI Bank ICBK.NS remain the three domestic systemically important banks (D-SIBs) and that the first two would need to maintain an additional capital buffer starting April 2025.

Systemically important banks are financial institutions whose failure or distress could trigger a broader financial crisis and threaten the stability of the entire financial system. These institutions are also perceived as being "too big to fail".

The Reserve Bank of India had issued a framework for dealing with D-SIBs in July 2014, under which it named the designated banks and placed them in appropriate "buckets" depending on their systemic importance.

A higher bucket requires higher the bank to maintain a larger capital buffer, along with other financial metrics.

SBI and ICICI Bank were classified as D-SIBs in 2015 and 2016. While HDFC Bank was added to the list in 2017, it was moved to a higher bucket in December 2023 following its merger with parent HDFC.

The RBI said that SBI and HDFC Bank have to set a higher additional capital buffer and capital surcharge from the next financial year which begins on April 1, 2025.

SBI's additional capital requirement will increase by 20 basis points to 0.80% in proportion to its risk-weighted assets, from 0.60% currently.

Meanwhile, HDFC Bank will be required to maintain a capital surcharge of 0.40% in proportion to its risk-weighted assets, up from 0.20% currently.

(Reporting by Siddhi Nayak; Editing by Varun H K)

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MUMBAI, Nov 12 (Reuters) - India's ICICI Home Finance ICICH.UL plans to raise 6 billion rupees ($71 million) through the sale of bonds maturing in three years, three bankers said on Tuesday.

The company will pay an annual coupon linked to the 91-day Treasury bill yield and has invited bids from bankers and investors on Wednesday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Nov. 12:

*Size includes base plus greenshoe for some issues

($1 = 84.4020 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Sumana Nandy)

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MUMBAI, Oct 31 (Reuters) - Indian banks' loan growth moderated this September, compared with the same month a year ago, central bank data showed on Thursday, as the impact of the Reserve Bank of India's clampdown on "exuberance" in retail lending continued.

Banks' credit grew at 14.4% year-on-year last month, slower than the 15.3% increase in September 2023, excluding the impact of HDFC Bank merging with parent Housing Development Finance Corp (HDFC), the RBI said.

Including the impact of the merger, banks' loans grew 13% last month, compared with 20% a year ago.

Loan growth had moderated in August as well.

Indian banks have consistently reported double-digit loan growth for a while, helped by healthy economic growth and urban consumption. However, the RBI, worried about the risk of bad loans, imposed higher capital requirements on banks late last year.

Despite that, some segments, such as personal loans and credit card loans posted strong growth, in excess of 25%, until earlier this year when the central bank governor warned against "exuberance".

The RBI followed up on its norms with a series of actions against non-complying entities and that, along with rising defaults especially in the once fast-growing segments like personal loans and credit cards, have slowed both loan growth.

Banks' personal loan growth halved to 12.1% in September from a year ago, while growth in credit card outstanding dropped to 18% from 31.4% a year ago, the RBI data showed.

A rise in defaults by over-leveraged small borrowers is hitting India's top lenders, with bank executives and analysts expecting higher levels of stress in these personal segments over the next year.

Credit growth to the services sector decelerated to 15.2% in September from 21.6% a year ago, primarily due to lower growth in credit to non-banking financial companies.

On the flip side, loans to industry grew by 9.1% year-on-year in September, quicker than the 6% growth last year.

(Reporting by Siddhi Nayak; Editing by Savio D'Souza)

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Updates at 9:28 a.m. IST

Oct 28 (Reuters) - Indian shares opened higher on Monday, led by private lender ICICI Bank, after it surpassed second-quarter profit estimates on healthy loan demand.

The NSE Nifty 50 .NSEI rose 0.33% to 24,263.3 points as of 9:28 a.m. IST, while BSE Sensex .BSESN inched 0.41% higher to 79,770.2.

ICICI Bank ICBK.NS, the third heaviest Nifty 50 stock, rose 2.5% and led gains in banks .NSEBANK and financials .NIFTYFIN, which are up about 1% each.

Better asset quality and the highest current account-savings account growth among peers have been encouraging signs from the private lender's results, according to three analysts.

Ten of the 13 major sectors logged gains. The broader, more domestically focused small- .NIFSMCP100 and mid-caps .NIFMDCP100 rose about 0.4% each

Among individual stocks, non-bank lender Shriram Finance SHMF.NS rose 5% after reporting a rise in profit and improvement in asset quality in the September quarter.

Bandhan Bank BANH.NS gained 8%. The lender's profit not only beat estimates but its quality of microfinance loans has also held- up, confirming that the bank can outperform peers in this cycle, said Jefferies in a note.

Real estate developer DLF DLF.NS rose 4.1% on posting higher second-quarter profit on sales of housing units launched in previous quarters.

State-owned Coal India COAL.NS dropped 2% after reporting a fall in net profit in the September quarter.

($1 = 84.0780 Indian rupees)

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sherry Jacob-Phillips and Janane Venkatraman)

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Corrects year-earlier net interest margin to 4.53%, not 4.36%, in paragraph 8

MUMBAI, Oct 26 (Reuters) - ICICI Bank ICBK.NS, India's second-largest private lender, reported a bigger-than-expected second-quarter profit on Saturday, helped by healthy loan growth and core lending income, even as lending margins shrunk.

The Mumbai-based lender's standalone net profit rose 14.5% to a record 117.46 billion rupees ($1.4 billion) in the July-September quarter.

That exceeded analysts' average estimate of 109.87 billion rupees, according to LSEG data.

ICICI Bank's total loans rose 15.7% in the quarter, while deposits grew by the same percentage.

Net interest income, or the difference between interest earned on loans and paid on deposits, increased by 9.5% to 200.48 billion rupees.

Indian banks have consistently reported double-digit loan growth over the past few months, helped by healthy economic growth and urban consumption.

Banks are also scrambling to raise deposits to fund loan growth, which has weighed on margins.

ICICI Bank's net interest margin (NIM) -- a key gauge of profitability -- fell to 4.27% from 4.53% a year earlier and 4.36% in the previous quarter.

Private lenders Kotak Mahindra Bank KTKM.NS and RBL Bank RATB.NS have also reported lower margins for the quarter.

ICICI Bank's provisions and contingencies, or funds set aside for potential bad loans, rose sharply to 12.33 billion rupees, from 5.83 billion rupees a year ago.

Lenders like Kotak Mahindra Bank, IndusInd Bank INBK.NS and RBL Bank have all raised their provisions due to stress in their unsecured and microfinance loans businesses.

ICICI Bank's asset quality improved, with the gross non-performing assets (NPA) ratio at 4.27% as of end-September, versus 2.15% at the end of the prior three months.

Shares of ICICI Bank ended 2.9% higher ahead of the results on Friday.

(Reporting by Siddhi Nayak
Editing by Shri Navaratnam)

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• ICICI Bank Ltd IBN.N, IBN is expected to report resultson October 26 for the period ending September 30 2024

• 
  

• ​LSEG's mean analyst estimate for ICICI Bank Ltd is for earnings of 35 cents per share.

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 4 "strong buy" or "buy," no "hold" and no "sell" or "strong sell."

• The mean earnings estimate of analysts was unchanged in the last three months. ​

• Wall Street's median 12-month price target for ICICI Bank Ltd is $34.90​, above​ its last closing price of $29.57. ​​​

This summary was machine generated October 24 at 12:59 GMT. All figures in US dollars unless otherwise stated. (For questions concerning the data in this report, contact [email protected]. For any other questions or feedback, contact [email protected])

BENGALURU, Oct 22 (Reuters) - Indian insurer ICICI Prudential Life Insurance Company ICIR.NS on Tuesday reported a decline in a key margin in the first half of the fiscal year due to higher sales of market-linked policies.

Demand for market- or unit-linked insurance plans (ULIPs) has been strong in recent quarters, driven by India's rising equity market.

More sales of such policies, which have a lower profit margin, lead to the contraction of value of new business (VNB) margins for insurers.

ICICI Prudential's VNB margin dropped to 23.7% for the half-year ended Sept. 30 from 28.8% a year earlier as the share of ULIPs in the product mix jumped to 51.6% from 42.4%.

Its annualised premium equivalent sales, a key metric that gives annualised total value of all single premium and recurring premium policies, rose 26.8% to 44.67 billion rupees ($531.44 million) for the half-year.

The insurer's profit rose 3% on-year to 2.52 billion rupees for the quarter ended Sept. 30, while its net premium income grew around 7%.

Shares of the company ended down 2.5% ahead of the results.

($1 = 84.0540 Indian rupees)

(Reporting by Nishit Navin; Editing by Mrigank Dhaniwala)

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Oct 16 (Reuters) - ICICI Bank Ltd ICBK.NS:

• RBI IMPOSES FINE OF 211,000 RUPEES ON CO

Source text for Eikon: ID:nNSE10FmSj

Further company coverage: ICBK.NS

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Oct 7 (Reuters) - ICICI Bank Ltd ICBK.NS:

• ICICI BANK - FULLY REDEEMED OUTSTANDING NOTES OF $153.2 MILLION UNDER GLOBAL TERM NOTE PROGRAMME

Source text for Eikon: ID:nBSEbPYmr4

Further company coverage: ICBK.NS

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Sept 23 (Reuters) - Inox Wind Ltd INWN.NS:

• INOX WIND LTD - SIGNS CONSORTIUM AGREEMENT WITH BANKS FOR 22 BILLION RUPEES FACILITIES

• INOX WIND - CONSORTIUM OF 10 BANKS LED BY ICICI BANK, WITH HOST OF MARQUEE PVT, FOREIGN BANKS

• INOX WIND - CONSORTIUM AGREEMENT LIMIT LIKELY TO BE ENHANCED FURTHER TO 24 BILLION RUPEES

Source text for Eikon: ID:nBSE8057zV

Further company coverage: INWN.NS

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