IndusInd Bank Shares In Focus As Lender Reports Mixed Performance In Q4 Update; Key Points – News18
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Shares of IndusInd Bank Ltd. after the bank reported a mixed performance in its Q4 FY25 business update; Key things to know
IndusInd Bank Share Price Today
IndusInd Bank Share Price: Shares of IndusInd Bank Ltd., a Mumbai-based private lender, are likely to attract attention on Monday following the bank’s mixed performance in its Q4 FY25 business update.
IndusInd Bank’s net advances saw a modest 1.4% year-on-year (YoY) growth but experienced a 5.2% quarter-on-quarter (QoQ) decline, dropping to Rs 3.47 lakh crore. This discrepancy led the bank to enlist Grant Thornton for an extensive forensic review. As India’s fifth-largest private sector bank, IndusInd has faced a significant 25% drop in its stock price since this accounting issue was disclosed.
While the bank reported a 1.4% annual growth in loans and a 6.8% increase in deposits, concerns over governance and financial irregularities continue to weigh on its share price. In an effort to shore up its financial position, IndusInd Bank raised $2 billion in high-cost bulk deposits in March, marking its largest monthly increase in over two years. The bank’s CASA ratio—reflecting low-cost current and savings account deposits—fell to 32.8%, down from 34.9% in the previous quarter and 37.9% a year earlier.
The bank’s liquidity coverage ratio, which indicates its ability to meet short-term obligations with liquid assets, stood at 118.4% for the quarter. Retail and small business deposits dropped slightly to Rs 1.85 lakh crore as of March 31, 2025, from Rs 1.88 lakh crore at the end of the previous quarter. IndusInd’s mixed performance highlights the challenges it faces in balancing growth with the need to address financial and governance concerns.
In its Q4 FY25 update, the bank showed growth in total deposits, which rose 6.8% YoY and 0.4% QoQ, reaching Rs 4.11 lakh crore. However, the corporate banking sector faced a contraction, with a 4.9% YoY and 15.1% QoQ decline. In contrast, the consumer banking segment showed strength, with a 6.3% YoY and 3.4% QoQ increase, reflecting a shift toward retail banking. The decline in the CASA ratio indicates growing cost pressures and an increased reliance on more expensive funding sources, which could affect future profitability. A slight drop in retail and small business deposits suggests cautious sentiment among consumers.
As the bank navigates these challenges, its strategic direction will be key. Competitors like HDFC Bank and ICICI Bank continue to show strong growth, making IndusInd’s path forward all the more crucial. Analysts are closely monitoring the bank’s efforts to ensure governance transparency and financial stability.
What Brokerages Are Saying
On Friday, global brokerage UBS reiterated its “Sell” recommendation for IndusInd Bank, reducing the stock’s price target by 22% to Rs 600, down from Rs 770. UBS raised concerns about several risk factors, particularly the bank’s deposit flows, which it believes could destabilize its financial position. The potential appointment of a new CEO is also seen as a risk. UBS stressed that the findings from an external auditor’s report will be critical in determining the bank’s future trajectory.
Meanwhile, Elara Securities expects a challenging quarter for IndusInd, with pressure on various fronts. The brokerage highlighted potential weaknesses in asset quality, particularly in the microfinance (MFI) portfolio. Additionally, Elara pointed out that recent issues related to derivative accounting and management changes, combined with a decline in net interest margins (NIMs), could impact net interest income (NII) growth and overall momentum. The brokerage anticipates that discussions in the coming quarter will focus on the final impact of audits, growth prospects, deposit growth, and the normalization of credit costs.
IndusInd Bank shares closed at Rs 682.25 on Friday, reflecting a decline of 3.83%.
