The Net Interest Income (NII) (difference between the interest earned and interest expensed) for the private sector lender rose 12.7 percent on year to Rs 3,985 crore as compared to the NII of Rs 3,534.61 crore registered in the year ago quarter.
IndusInd Bank
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IndusInd Bank share price rose 2 percent in the early trade on May 2 after company came out with its March quarter earnings.
IndusInd Bank on April 29 reported a growth of 51.2 percent year-on-year in its consolidated profit after tax (PAT) of Rs 1,400.5 crore as compared to Rs 926.07 crore registered a year back. On a sequential basis, the profit has inched up 12.8 percent from Rs 1,241.39 crore logged during the October-December period.
The Net Interest Income (NII), or the difference between the interest earned and interest expensed, for the private sector lender rose 12.7 percent on-year to Rs 3,985 crore as compared to the NII of Rs 3,534.61 crore registered in the year-ago quarter.
On a sequential basis, the NII is higher by 5.1 percent from the NII of Rs 3,793.51 crore recorded in the previous quarter.
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Here is what brokerages have to say about stock and the company post March quarter earnings:
CLSA
Broking house CLSA has maintained buy rating on IndusInd Bank with a target at Rs 1,200 per share.
The collections in MFI and CVs have fully normalized, while see normalisation of credit costs to 160 bps over FY23-24.
CLSA expect RoE of 15 percent by FY24 and see 1.25x March 2024 book as reasonable, reported CNBC-TV18.
Morgan Stanley
Research firm has kept overweight rating on the stock and raised the target price to Rs 1,300 per share.
The Q4 core PPoP and asset quality was strong versus estimates. The NPL coverage, retail deposit mix and balancesheet granularity improved.
Morgan Stanley expect credit cost to normalise, driving 14-15 percent RoE in F23/F24, reported CNBC-TV18.
Credit Suisse
Brokerage house has maintained outperform rating on the stock and raised target price to Rs 1,150 per share.
The Q4 was slightly ahead of estimates, led by healthy operating performance.
Credit Suisse raises FY23/24 EPS estimates by 2 percent on better asset quality outcomes and expect RoE to improve to more than 15 percent in FY24, reported CNBC-TV18.
Nomura
Broking house Nomura has maintained buy rating on the stock with a target at Rs 1,285 per share.
The pick-up in microfinance, vehicle loan and restructuring performance are the key catalysts.
Nomura lowers FY23/24 EPS estimates by 8 percent/7 percent and cut core PPoP estimates by 1 percent/2.6 percent for FY23F/24F, reported CNBC-TV18.
Kotak Institutional Equities
Kotak Institutional Equities has kept buy rating on the stock and raised the target to Rs 1,050 from Rs 975.
The strong 55 percent YoY earnings growth led by 9 percent YoY operating profit, while slippages are still high but bank is well past its worst phase.
It may see a less exciting growth phase ahead and focus would be on risk-adjusted returns, reported CNBC-TV18.
Sharekhan
A well-capitalized balance sheet, improvement in collection efficiencies in MFI business, reduction in fresh slippages/ restructured book and high PCR levels, credit cost seems to be manageable and business normalcy is expected to resume in FY2023E.
Given the improvement in demand in its vehicle portfolio, MFI business and corporate book, the bank is on upward trajectory path in terms of ROA & ROE profile going forward.
Bank guided for credit growth of 15-18 percent going forward along with building granular retail liability franchise. We believe valuations are reasonable. Hence we maintain a Buy rating on the stock with an unchanged price target of Rs 1,150.
Motilal Oswal
IndusInd Bank’s operating performance remains on track, led by healthy NII growth, lower slippages, and controlled provisions. Asset quality ratios improved sequentially as stress in the MFI/Vehicle portfolio subsided.
The management guided at continued momentum in loan growth, led by steady trends across both Consumer and Corporate businesses.
Healthy provisioning in the MFI portfolio and contingent provisioning buffer of 1.4 percent of loans will enable a sharp drop in credit cost, driving a sharp recovery in earnings.
We expect 37 percent PAT CAGR over FY22-24, resulting in 15.5 percent RoE in FY24. We maintain our Buy rating with a target price of Rs 1,300 per share (1.7x FY24E ABV).
LKP Research
Core operating performance of IndusInd Bank remains healthy. A higher PCR is likely to safeguard the bank from credit disruption from various restructuring schemes. Thus we retain our BUY rating with price target of Rs 1,195 (based on 1.7x FY23E Adj. BVPS of Rs 703).
At 9:19am IndusInd Bank was quoting at Rs 1,002.00, up Rs 23.80, or 2.43 percent on the BSE.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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