Zacks Investment Research downgraded shares of ICICI Bank Limited – ADR (IBN) from OUTPERFORM to NEUTRAL on December 18, 2014, with a target price of $12.00.
We are downgrading our recommendation on ICICI Bank to Neutral owing to a continued deterioration in its asset quality. Nonetheless, the bank's strong second-quarter fiscal 2015 (ended Sep 30) results largely benefited from a rise in revenues, partially offset by elevated operating expenses and higher loan loss provisions. We expect the company's increased dependence on domestic loans, focus on improving fee income, a stable fund base and market leadership in the insurance business to continue generating synergies. However, a highly competitive operating environment, continuously rising expenses and stringent regulatory requirements will likely dampen ICICI Bank's financial performance.
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