Prabhudas Lilladher's research report on IndusInd Bank
IIB saw a good quarter with core earnings at Rs15.2bn beating estimates by 2.5% led by stronger fee income and lower provisions. NII/NIM were better owing to a positive impact of yield while fees saw healthy traction as share of retail fees enhanced. GNPA saw a minor blip due to lower recoveries. Credit momentum is expected to continue and IIB is targeting a 15-18% loan growth keeping credit costs contained between 1.2-1.5%. Focus is to garner retail deposits which would require branch addition that could keep opex elevated. We see a loan CAGR of ~16% over FY22-24E with declining provision costs, while deposit accretion remains the key monitorable.
Outlook
Over FY22-24E we expect a healthy 33% CAGR in earnings and RoE may enhance from 10% to 15%. Valuation at 1.2x FY24ABV is undemanding. Maintain multiple at 1.8x with TP of Rs1,300. Retain BUY.
More Info
At 13:05 hrs IndusInd Bank was quoting at Rs 946.60, up Rs 67.70, or 7.70 percent.
It has touched an intraday high of Rs 961.20 and an intraday low of Rs 893.90.
It was trading with volumes of 512,848 shares, compared to its thirty day average of 109,230 shares, an increase of 369.51 percent.
In the previous trading session, the share closed up 1.20 percent or Rs 10.40 at Rs 878.90.
The share touched its 52-week high Rs 1,241.85 and 52-week low Rs 763.75 on 28 October, 2021 and 23 June, 2022, respectively.
Currently, it is trading 23.78 percent below its 52-week high and 23.94 percent above its 52-week low.
Market capitalisation stands at Rs 73,371.22 crore.
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