Worst Over For IndusInd Bank Stock? Market Experts Weigh In On Buy, Sell Or Hold

As IndusInd Bank Ltd. grapples with management churn and questions over governance after posting miserable final quarter results, market experts Ashwin Parekh, managing partner at Ashvin Parekh Advisory Services LLP, and Ashutosh Mishra, head of research in institutional equity at Ashika Stock Broking, offered a measured view on the road ahead, speaking to NDTV Profit.

Parekh didn't mince words, squarely holding the board accountable. "Without the senior management being aware of what was going on, it couldn’t have continued for so long," he said, pointing to a deeper cultural issue that persisted from 2016. "Whether you're an internal auditor or a statutory auditor, you start getting the sense that something is going wrong," he added. "I would certainly say there's a fraud and a cultural issue."

Yet, Parekh noted that if the new leadership has a long enough runway, at least "five to six years left in their career", they could aim to rebuild IndusInd and bring back its vibrancy.

Ashutosh Mishra took a slightly more optimistic view on the franchise itself, calling it "good at this point of time" but cautioned that investors should assess it from two angles — the bank-specific developments and the broader industry outlook. "RBI has just released an equity bazooka in the banking system," Mishra said, adding that the sector as a whole stands to benefit from this liquidity boost in the second half of the year.

Still, uncertainty looms large. "The road ahead will not be as clear," Mishra noted, highlighting the lack of clarity around who will take charge at the top. He expects "at least two to three quarters of not getting clear visibility of the path ahead."

For investors, Mishra advised a wait-and-watch stance. "If you already have the stock, it's better to hold it at this level," he said. "Cleaning up has already taken place, and if a good name steps in as MD and CEO and you think he has a credible track record, then you may see a turnaround taking place here."

This conversation follows the company's declaration of their fourth-quarter performance on Wednesday, where the lender had reported a net loss of Rs 2,329 crore for the quarter under review, as against a net profit of Rs 2,349 crore a year ago.

Analysts polled by Bloomberg had estimated the bank to report a net loss of Rs 410.85 crore.

The company had also, in the post-earnings analysts call, disclosed that it is dealing with more accounting discrepancies other than the ones that came to the fore earlier. This includes Rs 173 crore incorrectly recorded in the microfinance portfolio.