Accumulate IndusInd Bank; target of Rs 1322: Arihant Capital

Arihant Capital recommended accumulate rating on IndusInd Bank with a target price of Rs 1322 in its research report dated October 28, 2021.

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// else // $ (‘#toptitleTXT’).html(tickTxt+typevar+’already exists in your watchlist’); // //} } //$ (‘.accdiv’).html(”); //$ (‘.accdiv’).html(appndStr); } }, //complete:function(d){ // if(typparam1==1) // { // watchlist_popup(‘open’); // } //} }); }); } else { var disNam =’stock’; if($ (‘#impact_option’).html()==’STOCKS’) disNam =’stock’; if($ (‘#impact_option’).html()==’MUTUAL FUNDS’) disNam =’mutual fund’; if($ (‘#impact_option’).html()==’COMMODITIES’) disNam =’commodity’; alert(‘Please select at least one ‘+disNam); } } else { AFTERLOGINCALLBACK = ‘overlayPopup(‘+e+’, ‘+t+’, ‘+n+’)’; commonPopRHS(); /*work_div = 1; typparam = t; typparam1 = n; check_login_pop(1)*/ } } function pcSavePort(param,call_pg,dispId) { var adtxt=”; if(readCookie(‘nnmc’)){ if(call_pg == “2”) { pass_sec = 2; } else { pass_sec = 1; } var url = ‘//www.moneycontrol.com/mccode/common/saveWatchlist.php’; $ .ajax({url:url, type:”POST”, //data:{q_f:3,wSec:1,dispid:$ (‘input[name=sc_dispid_port]’).val()}, data:{q_f:3,wSec:pass_sec,dispid:dispId}, dataType:”json”, success:function(d) { //var accStr= ”; 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Arihant Capital’s research report on IndusInd Bank

IndusInd Bank (IIB) has reported decent performance during Q2FY22 with strong profit growth of 72% YoY to INR 1,114 cr vs. our estimate of INR 1,102 cr. Profit growth for the quarter was higher due to 13% YoY/8% QoQ decline in provisions. With the pick in business momentum and opening up of economy, loan growth of the bank has picked up. Advances of the bank increased by 10% YoY as compared to 6% YoY growth in the previous quarter led by strong growth in Corporate portfolio. NII for the quarter grew by 12% YoY/3% QoQ to INR 3,658 cr was marginally ahead of our estimate of INR 3,658 cr. Operating profit of the bank increased by 12% YoY/1% QoQ to INR 3,174 cr vs our estimate of INR 3,101 cr. Contingent provision of the bank has increased from INR 2,050 cr (1% of loans) to INR 3,178 cr (1.4% of loans) as bank has prudently provided for its telecom exposure. Total loan related provision of the bank increased from 3.6% to 3.9% of total loans. Headline NPA ratio of the bank improved with GNPA/NNPA improvement of 11bps/4bps QoQ at 2.8%/0.8%. Restructuring pool has increased from 2.7% to 3.6% of loans on sequential basis.

Outlook

We roll forward our estimates to FY24E and maintain our ‘Accumulate’ rating on the stock with a revised TP of INR 1,322 (earlier INR 1,095), based on 1.7x FY24E ABV.

For all recommendations report, click here

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