IndusInd Bank Ltd. share price target

Indusind bank has reported a good set of numbers and the positives are 1) Reported slippages (28bn v/s 38bn) inched down from the previous quarter; retail slippages contributed 85% of total slippages 2) Built ample provision buffer; 150bps of net advances 3) Coming back to growth...

Loan book expanded 2.6% QoQ to Rs. 212,595cr, whereas deposits climbed 7.1% QoQ to Rs. 256,205cr. GNPA/NNPA jumped to 2.67%/0.69% (vs 1.74%/0.22% in Q3FY21) due to higher amount of restructured advances. NRI and affluent banking, tractor financing have acted as growth catalysts for this fiscal. The bank's yield margins are expected to improve due to exposure to relatively risky assets. However the overall asset quality stress is well in-line with the risk-return expectations of the...

Net interest income increased 9.4% YoY and 3.8% QoQ to | 3535 crore with stable NIMs at 4.1% QoQ. Margins remained stable as excess liquidity had a drag on benefit of reduction in cost of funds. Other income was up 4.4% QoQ, driven by 9% QoQ uptick in core fee income. In turn, this was boosted by 24% QoQ rise in retail fees. Cost-to-income increased 56 bps QoQ to 42.4% as opex increased due to revival in business activity. The bank during the quarter made provisions worth | 1866 crore and was flattish QoQ. Net profit came in at | 876 crore and was in line with our estimates....

IndusInd's asset quality improved with GNPA at 2.67% vs 2.93% QoQ (2.45% YoY) as recoveries/upgrades were higher; while slippage ratio (annualized) increased to 7.2% vs 5.0% QoQ. Restructured book stood at 2% (vs earlier guided at 1.8%) which comprises of 65% Vehicle, 17% non-vehicle and rest from corporate book. Bank reported collection efficiency at 98% for March quarter vs 97% QoQ; however due to lockdown in specific states it declined by 1% in April month. Deposit reported strong growth of 27% YoY while advances grew by 3%YoY. NII grew by 9% YoY (up 4% QoQ) while NIMs remain stable QoQ. Non-interest income remains flat YoY (up 4% QoQ). PAT grew by 190% YoY due to decline in provisions (down 24% YoY). Bank maintains overall...

IIB's earnings of Rs8.7bn missed estimates (PLe: Rs9.6bn) partly on slightly weaker income and partly on continued provisions. Slippages were slightly higher led from corporate and invoked restructuring led to upgrades as well. Retail slippages though were lower sequentially has been still on higher side, continued from VF, MFI, unsecured. Restructuring outcome has been slightly than anticipated (2% v/s 1.8% expected) as second wave has increased retail/SME borrowers to opt for restructuring. With much better PCR of 74% v/s 43% in FY19 and 80bps (Rs16.0bn) of contingent provisions cushion...

IndusInd Bank (IIB) reported in-line Q4FY21 PAT of Rs 9.3bn with a steady operating performance marked by 9%/10% YoY growth in NII/operating profit.

Indusind Bank has reported better than expected numbers in 4QFY21, as its GNPA/NNPA ratio declined to 2.67%/0.69% from pro-forma NPA ratio of 2.93%/0.7% in the previous quarter. As a result of resumption in asset classification, the gross slippages inched up to 63.3bn v/s...

IIB reported a stable 4QFY21, with an in line performance. On the business front, deposits grew 7% QoQ, while loan growth is seeing a revival. On the asset quality front, GNPA ratio improved sequentially and stood at 2.67%/0.69%, with PCR ~75%. In addition to this, the bank holds a COVIDrelated provision buffer at 75bp of loans. Restructured book stood at 2% of loans (slightly higher than the guided 1.8%), largely from the Vehicle portfolio. With the rise in COVID-19 cases and a recent lockdown in a few Indian states, we remain watchful as MFI and CV are the most impacted segments. We cut our FY22E/FY23E earnings estimates by 15%/6% as we...

Stress created due to the Coronavirus pandemic seems to have eased for the banking sector.