Sharekhan's research report on IndusInd Bank
IndusInd Bank reported a PAT of Rs.1,361 crore in line with the consensus estimates. PAT grew by 55% y-o-y / 17% q-o-q mainly due to lower provisions which were down by -22%y-o-y/ -12% q-o-q. Asset quality improved with GNPA and NNPA ratios declining by 21 bps q-o-q and 7 bps q-o-q to 2.27% to 0.64%, respectively. PCR now stands at 72%. Advances growth was backed by retail liability growth. Retail deposits grew by 26% y-o-y vs 12% advances growth, during the quarter. Bank stated that 15%-18% advance growth is achievable going forward backed by retail liability growth. The stock currently trades at 1.4x/ 1.2x of its FY23E and FY24E ABV. We believe valuations are reasonable given the ROA profile expected in FY23E/24E.
We maintain a Buy rating with an unchanged PT of Rs. 1,150.
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