IndusInd Bank, already under scrutiny due to multiple audits and top-level resignations, is expected to post a weak financial performance for the March quarter (Q4FY25), weighed down by recently uncovered accounting discrepancies. The private lender is scheduled to announce its quarterly results on May 21, 2025.
According to Moneycontrol's poll of 6 brokerage estimates, the bank’s net interest income (NII) is likely to dip 4.5 percent year-on-year to Rs 5,132 crore in Q4FY25, compared to Rs 5,376 crore in the same period last year. More alarmingly, the bank is expected to swing to a net loss of Rs 304 crore in Q4FY25 from a net profit of Rs 2,347 crore in Q4FY24.
Estimates of analysts polled by Moneycontrol are shown to be in a diverse range, meaning any positive or negative surprises may elicit a sharp reaction in the stock price. Notably, the estimates were made before May 15, when new discrepancies related to interest income came to light. Among the brokerages polled, Anand Rathi rolled out the most bullish projections while Elara Capital forecasted the slowest growth for IndusInd Bank.
What factors are driving the earnings?
Margin moderation: According to Kotak Institutional Equities, the bank’s net interest margins (NIMs) are projected to fall by 67 basis points—from 4.3 percent in Q4FY24 to 3.6 percent in Q4FY25. Analysts at CLSA highlighted that recent audit findings revealed core NIMs were actually 17 basis points lower than what had been reported, due to discrepancies in the accounting of ‘interest income’ and ‘other assets’.
Spike in provisions: Kotak analysts expect loan-loss provisions to jump 155 percent to Rs 2,300 crore in Q4FY25, driven by fresh slippages, particularly from the bank’s microfinance (MFI) portfolio.
Asset quality deterioration: With rising provisions, analysts broadly anticipate a deterioration in asset quality for the lender during the quarter.
What to look out for in the quarterly show?
Analysts will be closely monitoring deposit mobilisation trends, changes in the marginal cost of funds, the aftermath of the derivative accounting issues, and developments in the MFI portfolio.
The bank recently disclosed that Rs 674 crore had been mistakenly booked as interest income across three quarters of FY25. This follows its earlier admission on March 10 about irregularities in its derivative portfolio, expected to impact 2.35 percent of its net worth as of December 31, 2024.
So far in 2025, IndusInd Bank’s stock has fallen nearly 20 percent, underperforming the benchmark Nifty 50, which has risen 5 percent over the same period.
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