IndusInd Bank Q2 Review: Systematix Maintains 'Hold', Cuts Target Price — Here's Why

IndusInd Bank made additional accelerated provision in the quarter amounting to Rs 8.46 billion owing to the persistent elevated stress in MFI segment due to which the provisions increased to Rs 26.2 billion, up 50.9% QoQ and 44.1% YoY..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Report.IndusInd Bank Ltd. has reported a net loss during the quarter of Rs 4.4 billion due to- Accelerated provisioning due to persistent elevated MFI stress,Contraction in margins led by lower MFI disbursements. The Net interest margin was at 3.32%, down -14bps QoQ and -76bps YoY. The Yield on advances declined by -30 bps QoQ and by -99 bps YoY to 11.3%. This was partially offset by a decline of -21bps QoQ in Cost of Deposits to 6.2%. The management expects the margins to improve once the disbursements in Micro Finance segment pick up. The annualised gross slippage ratio increased by 4 bps QoQ and 99bps YoY to 3% in Q2. The credit costs stood at 3.2%, up by 113 bps QoQ and 112 bps YoY. The bank made additional accelerated provision in the quarter amounting to Rs 8.46 billion owing to the persistent elevated stress in MFI segment due to which the provisions increased to Rs 26.2 billion, up 50.9% QoQ and 44.1% YoY. The management stated that it expects the pace of accelerated provisions to decline going forward. 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 a revised price target of Rs 800 (Rs 840 earlier). We are valuing the bank at 0.9x on its FY27E book value per share of Rs 888..Click on the attachment to read the full report:.ICICI Bank Remains Motilal Oswal's Preferred 'Buy' In The Sector Post Robust Q2 Results — Check Target Price.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

IndusInd Bank Q2 Review: Systematix Maintains 'Hold', Cuts Target Price — Here's Why

Systematix continues to be watchful of IndusInd Bank’s performance going forward and wait for signs of stability.

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