The stock price of IndusInd Bank surged 3.12% to Rs 1,464.70, a day after the Bank posted 22% growth in consolidated net profit at Rs 2,202 crore for the second quarter of FY24. Banks’ Net interest margin for Q2FY24 stood at 4.29% against 4.24% for Q2FY23 and 4.29% for Q1FY24. Total income increased to Rs 13,530 crore during the quarter under review, as against Rs 10,719 crore in the same period last year, IndusInd Bank said in a regulatory filing.
IndusInd Bank’s share price gained 1.39% in the last five days, 0.53% in the last one month, 29.17% in the last six months and 18.73% in the last one year.
Motilal Oswal Financial Services: Buy – Target Price: Rs 1,700
“IndusInd Bank (IIB) reported an in-line 2QFY24 performance. PAT was up 22% YoY at Rs 2200 crore, aided by healthy NII growth (up 18% YoY) and lower provisions (down 15% YoY). Fresh slippages rose 7% QoQ to Rs 1470 crore, driven by a sharp rise in slippages in the corporate book to Rs 210 crore from Rs 4 crore in 1QFY24. GNPA/NNPA ratios remained stable at 1.93%/0.57%. The restructured book declined 12bp QoQ to 0.54%. We estimate IIB to deliver a 23% earnings CAGR over FY24-26 and RoA/RoE of 2.0%/16.8% by FY25. We reiterate our ‘Buy’ rating with a Target Price of Rs 1,700.”
Prabhudas Lilladher: Buy – Target Price: 1,530
“Growth of 18-20% for FY24 can be achieved, but sustaining the same over medium term would depend on strong liability accretion. Hence we are factoring a 17% loan CAGR over FY24-26E. Asset quality was stable; the bank would like to increase buffer provisions by Rs 300 crore in near term which would take the reserve to 58bps. Stock is valued at 1.7x for 1.9% RoA (FY25/26E) and levers for further re-rating are, strong liability accretion, reduction in cost to income and creation of buffer provisions with decline in credit costs. We maintain multiple at 1.8x but as we roll forward to Sep’25, our Target Price increases to Rs 1,620 from Rs 1,530. Retain ‘Buy’.”
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