Shares of IndusInd Bank fell nearly 4 percent on March 28, snapping their two-day gaining streak, ahead of external auditor PwC's report on accounting discrepancies, which is likely expected by the end of this week. The shares of the private lender closed at Rs 649 apiece.
Moneycontrol on March 27 reported that IndusInd Bank had ordered a forensic audit following the PwC probe to ascertain the impact of the deficiencies in derivative accounting practices on the lender's financials. Sources further told Moneycontrol that the final report is likely to be placed before IndusInd board by the end of this week.
IndusInd Bank on March 10 had disclosed certain discrepancies in its account balances related to its derivatives portfolio, resulting in an estimated impact of 2.35 percent of its net worth. The shares of the private lender crashed 26 percent following the the disclosure. The stock later recovered, after the management assured investors of posting profit during Q4FY25 as well as the upcoming financial year, despite absorbing losses.
The bank's promoter Ashok Hinduja said that the bank can take care of the discrepancies that have emerged. "Shareholders shouldn't panic. These are normal routine problems. I understand their concern is over why they were not informed earlier. Banking businesses are based on integrity and trust," he said.
The RBI has also issued a statement addressing speculation over IndusInd Bank, stating that the bank remains 'well-capitalised' and the financially position remains 'satisfactory'. The stock saw some volatility after the bank appointed Grant Thornton to conduct a forensic review into accounting lapses detected this month.
Additionally, recent reports have claimed that market regulator Sebi is investigating if IndusInd Bank executives engaged in insider trading during the uncertainties.
IndusInd Bank shares had plunged nearly 62 percent from its 2024 peak to hit a 52-week low of Rs 606 apiece on March 12. The stock has now made some recovery from that level.
Emkay Global recently removed IndusInd Bank from its model portfolio, citing uncertainty over leadership and the fallout from its derivatives accounting issue. While the brokerage acknowledges that the current valuations may already reflect much of the negativity, it does not expect an immediate recovery.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
