Accumulate IndusInd Bank; target Rs 460: P Lilladher
Brokerage house Prabhudas Lilladher is bullish on IndusInd Bank (IIB) and has recommended 'Accumulate' rating on the stock with a price target of Rs 460 in its research report dated October 14, 2013.
October 16, 2013 / 18:38 IST
Prabhudas Lilladher's report on IndusInd Bank (IIB)
"IndusInd Bank's (IIB) Q2FY14 results was better than market expectations driven by a beat on margins and stable asset quality. IIB has managed their P&L and B/S pretty well in the current rate/credit cycle but risk-reward at current valuations (2.5x Sep-14 book) is less attractive. Asset quality has held up well, with Gross NPAs in CVs inching down QoQ and manageable slippage levels in the corporate book. But unfavourable rating scale move on the corporate book and growth in real estate/Steel indicates some inch-up in riskiness of the book. On the liabilities side, SA accretion continues to remain strong (Rs6.8bn QoQ) and some relief on CD rates should lead to a pick-up in deposit growth, going forward.""Strongerthan- expected performance on CV asset quality and overall margins is positive; however, we believe some of it is captured in the current valuations (2.5x Sep- 14 book). Strong SA accretion and resilient ROAs remain structural positive but near term risk-reward is less attractive. Hence, we downgrade IIB to 'Accumulate' with PT of Rs 460/share (<10 percent upside)," says Prabhudas Lilladher research report.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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