Buy IndusInd Bank; target of Rs 1200: Motilal Oswal

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26 Aug, 2025 12:21

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Motilal Oswal's research report on IndusInd Bank

IndusInd Bank (IIB) reported a strong quarter with a 45% beat in PAT, led by a steady operating performance. The deposit portfolio grew 5% QoQ, while collection efficiency was steady at 97% (in-line with large peers). n The proforma GNPA/NNPA ratio stood at 2.93%/0.70%, with PCR at 77% (the highest thus far among the banks under our coverage). The bank restructured 0.6% of loans, while we expect this to increase to 1.8% by 4QFY21. We increase our earnings estimate for FY22/FY23 by 35%/14%, factoring in improvement in operating performance and moderation in credit cost. Maintain BUY.

Outlook

We expect IIB to deliver FY23E ROA/ROE of 1.8%/16.5%. Maintain Buy, with revised TP of INR1,200 (1.9x Sep’22e ABV).

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