The bottom line figure of Rs 250 crore for the fourth quarter entails a reduction by 12 per cent from Rs 284 crore in the fourth quarter of the previous year. In the first half of the current financial year, ICICI had registered a PAT (profit after tax) of Rs 572 crore, an increase of 72 per cent over the previous year.Now excluding the capital gains realised on the sale of ICICI Bank shares, the PAT of Rs 488 crore for the first half reflected a growth of 47 per cent. The PAT for the third quarter was Rs 259 crore, up by 69 per cent from Rs 163 crore.

For the financial year 1998, the net profit of Rs 1,081 crore is a 40 per cent increase from the previous year's figure. However, if the extraordinary items pertaining to gains from sale of ICICI Bank shares, certain real estate and restructuring cost related to the merger of ITC Classic are shorn off, the net profit works out to Rs 1,008 crore, an increase of 34 per cent. As on March 31, 1997, ICICI had an RoCE (PAT + tax adjusted interest / average capital employed) of 12.40 per cent. An RoCE of 12.1 per cent as on March 31, 1998, proves that the performance has been stagnant. Morever, the average cost of funds has remained unchanged at around 11.8 per cent. But the net spread has increased from 3.07 per cent in 1996-97 to 3.4 per cent in 1997-98. The RoA (EBIT / totalassets) has risen to 2.8 per cent from 2.5 per cent and the RoNW (PAT / networth) hasrisen from 20.9 per cent to 25.3 per cent. Dividend cover works out to 3.8 on a fully diluted EPS of Rs 21 and dividend per share of Rs 5.5.

Owing to recessionary conditions, disbursals to the manufacturing sector have reduced to 33 per cent from 66 per cent. In the event of an economic revival in the current year, disbursals to this sector might be around 40 per cent. In the period, the disbursals to the infrastructure sector was 22 per cent. Total approvals to this sector in the previous year was 15.6 per cent. In the first half, disbursals grew 21 per cent and approvals by 87 per cent. Also, for the third quarter disbursals were up by 46 per cent and approvals by 112 per cent. The tempo slowed down in the fourth quarter, with disbursals up 31 per cent and sanctions 33 per cent. For the whole year, ICICI's approvals and disbursements increased by 81 per cent and 41 per cent. As on April 21, 1998, the investment portfolioshowed a unrealised gain of Rs 130 crore. For the financial year 1997-98, it registered a capital gain of 50 per cent from the sale of illiquid investments. It is important that ICICI reduces its NPAs by sprucing up its recovery process. But the increase in NPAs does not detract from the ICICI management's initiatives, including linking staff compensation to performance, and aggressively going in for short-term lending.