IndusInd Bank Share Price Ends 27% Lower To Erase Rs 19,100 Crore In Market Value

IndusInd Bank Ltd.'s share price crashed 27% on Tuesday to the lowest since November 2020, after the lender identified accounting discrepancies of 2.35% of its net worth as of December 2024 in its derivatives portfolio during an internal review.

This sparked a string of target price cuts from several brokerages for the bank's stock amid fresh turmoil, days after the Reserve Bank of India allowed only a one-year extension to Chief Executive Officer Sumant Kathpalia.

The bank has appointed an external agency to review and validate its internal findings independently on the derivatives portfolio. The disclosure followed the Reserve Bank of India's September 2023 guidelines on bond investment categorisation and valuation.

This will have an approximate impact of Rs 2,100 crore, the management said in an analyst call.

IndusInd Bank will face a "litmus test" from the succession viewpoint and the board is likely to evaluate both external as well as internal candidates, Citi said. Recent developments have raised the risk perception and impact disclosed borrowings cost too, it added.

IndusInd Bank Share Price Down

IndusInd Bank's share price declined 28% to Rs 649 apiece, wiping off nearly Rs 19,100 crore in market value. The stock was the top loser on the benchmark NSE Nifty 50, which ended 0.17% higher.

In the previous trading session, the stock shed 3.7%.

The stock has fallen 57% in the last 12 months and 32% on a year-to-date basis. The total trade volume stood at 21 times the 30-day average. The relative strength index was at 29.

Twenty-five out of 49 analysts tracking IndusInd Bank have a 'buy' rating on the stock, 17 recommend a 'hold' and seven suggest a 'sell', according to Bloomberg data. The average 12-month analysts' price target of Rs 1,088 implies a potential upside of 21%.