IndusInd Bank Q1 Results Review— Asset Quality Remains Under Pressure With No Signs Of Growth, Says Systematix
Systematix continues to maintain Hold rating for IndusInd Bank with an unchanged price target of Rs 900.
IndusInd Bank as expected has turned profitable during the quarter, but the net profit remained subdued at Rs 6.84 billion, down -68% YoY. The net interest margin was at 3.46%, up 11 bps QoQ (against normalised Q4 margin) supported by- lower cost of deposits and higher share of retail loans. The fee income has been weak during the quarter, but the non-fee income has been strong supporting profitability.
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Systematix Report
Generally, for banking system Q1 is a weak quarter and for IndusInd Bank Ltd. it has been even weaker as it is still coming out of the financial fraud which impacted the bank’s business momentum severely.
We would continue to be watchful of the bank’s performance going forward and wait for signs of stability. We continue to maintain our Hold rating for IndusInd Bank with an unchanged price target of Rs 900.
We are valuing the standalone bank at 0.9x on its FY27E book value per share of Rs 1021.
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