IndusInd Bank Sees Shareholding Pattern Change — FPIs, Mutual Funds Swap Positions Amid Turbulence

Battling crisis after crisis, IndusInd Bank Ltd. has seen investor interest swing between foreign and domestic institutions in the last 12 months. What began as a seemingly isolated derivatives trading discrepancy snowballed into a multi-layered crisis involving leadership resignations, forensic investigations, insider trading probes, and a growing trust deficit.

A look at the public shareholding pattern over the last four quarters reveals an interesting trend—mutual funds that had been buying through the second half of 2024 turned sellers in the first half of 2025, while foreign portfolio investors (FPIs) did the opposite.

Shareholding patterns on the stock exchanges are updated on a quarterly basis.

Mutual funds owned 22.73% equity in IndusInd Bank at the end of the September quarter of 2024. The following quarter (Dec. end), their stake went up to 30.31%.

Then, when accounting discrepancies surfaced in mid-March, the share sale happened. By the end of the quarter, mutual funds' stake slipped to 27.55%, which further declined to 25.36% by June-end.

On the other hand, FPIs' holdings dropped from over 34% in September 2024 to just under 25% by the end of 2024. As the stock took a hit in March, the stake jumped to nearly 30% and then climbed to over 33%.

The April-June period saw exits in top management. Besides, IndusInd Bank's internal probes revealed more rot in its accounts.

Consequently, the fourth quarter results fared poorly. IndusInd Bank posted a net loss of Rs 2,329 crore for the quarter ended March 31, 2025, compared to a net profit of Rs 2,349 crore in the same period in FY24.

In late May, market regulator SEBI barred former CEO Sumant Kathpalia and four other current and former bank officials from the securities market.