Technically, ICICI Bank (CMP:312) may be in the grip of panic selling post budget high of around 362 & its subsequent failure to give consecutive closing above 345 zone. Further break of its recent positional key support of 316 is also accelerating its selling.
Looking at the chart, 307-304 zone should provide important positional support as of now and sustain below that, it may fall freely up to 290-270 zone. But break & sustain below 307 zone is a low probability until Nifty break & give consecutive close below 8470-8440 zone.
On the up side, consecutive close above 316 zone is very important for ICICI Bank & its short term target should be 345 & 362 zone. Sustain above 362, it could again target 390-410 zone in the mid term. Long term target may be 530.
Frankly speaking, I could not find any such negative news recently for ICICI Bank, except some concern on its NPA. It had started a separate unit/vertical post 2005 for its NPA recovery and proper management for stressed assets. But at the same time, we are probably in a structural improvement in asset quality of banking industry, specially for well managed private banks. Credit growth should pick up gradually and fresh slippages should come down.
For ICICI Bank, there is also scope of vast de-leveraging in the form of insurance (I-PRU) & securities (I-Direct) business.
Worst may be over for ICICI Bank.
As par BG model of techno/funda metrics, median valuation of ICICI Bank (stand alone data) is around 380 under the current market scenario.
| SCRIP | EPS(TTM) | BV(Act) | P/E(AVG) | LONG TERM | SHORT TERM | MEDIAN VALUE | 200-DEMA | 10-DEMA |
| ICICIBANK | 18.81 | 126.28 | 23.88 | 377.69 | 383.34 | 380.52 | 317.58 | 327.15 |
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