Shares of ICICI Bank  surged over 5% on Monday, sending its market capitalisation past the `8-trillion mark and into the  league of the top five companies by market value. The private lender has become the second bank to cross this milestone, after HDFC Bank. ICICI Bank’s market capitalisation reached Rs 8.14 trillion after its shares touched an all-time high of Rs 1,163 apiece, before ending the session with a gain of 4.72%.

Reliance Industries maintains its position as the most-valued Indian company, boasting a market capitalisation of Rs 19.8 trillion, while software giant Tata Consultancy Services (TCS) follows closely behind with a market cap of Rs 14 trillion. Among banks, HDFC Bank leads with a market capitalisation of Rs 11.6 trillion, while the State Bank of India, the country’s largest lender, has a market value of Rs 7.4 trillion.

The rally was fuelled by better-than-expected results for the fourth quarter posted by the lender on Saturday. CLSA raised the lender’s target price to Rs 1,350. JPMorgan, which has a target price of Rs 1,350 on ICICI Bank with an overweight rating, has upgraded FY25/26 earnings per share estimate by 4% and said valuations are reasonable and leave scope for an upward re-rating.  

“Even the faster-than-peer growth in unsecured loans has so far not resulted in any negative surprises. The bank is facing fewer business headwinds, which imply a steady execution is more than sufficient to maintain its superior valuation multiple,” analysts at Kotak Institutional Equities wrote.

The bank on Saturday reported a 17% rise in net profit to Rs 10,708 crore in the fourth quarter of the previous financial year, supported by a robust loan growth.

The bank also managed to improve its asset quality as its gross NPA ratio declined to 2.16% as on March 31, 2024, from 2.30% as on December 31, 2023.

Nuvama said the bank remains the most consistent in delivering core earnings and granular growth.

“With an early-mover advantage in leveraging technology for growth and risk management, we view ICICI as less vulnerable to regulatory lapses than peers, not to mention the moderation in opex much ahead of peers,” it noted.