Buy IndusInd Bank; target of Rs 1900: Motilal Oswal

Motilal Oswal is bullish on IndusInd Bank recommended buy rating on the stock with a target price of Rs 1900 in its research report dated January 13, 2024.

Broker Research

January 14, 2024 / 21:36 IST

Buy

26 Aug, 2025 12:21

Volume

Todays L/H

Motilal Oswal's research report on IndusInd Bank

IIB has been delivering consistent performance with both asset quality and return ratios improving steadily. The bank is well poised to report further improvement in operating performance as all key vectors (credit cost, margins & opex) continue to move in the right direction, unlike for most other banks. The steady loan growth (of 19% CAGR over FY24-26E) and a more favorable asset mix toward retail will continue to support margins, especially with the shift in the interest rate cycle. The bank aims to improve upon its CASA mix to >45%, while increasing the mix of retail deposits to 45-50% of the overall deposits. Asset quality ratios have improved, while continued moderation in slippages, dissolution of restructured assets (have declined to 0.5% vs peak of 3.6% in 2QFY22), and contingency buffer of 0.5% of loans provide further comfort. IIB is well capitalized with CET-1 of 16.3% and any further capital infusion by promoters to increase the stake in the bank would further aid capitalization levels. We estimate IIB to report 22% earnings CAGR over FY24-26E, resulting in a RoA/RoE of 2.0%/17.3%.

Outlook

IIB remains our preferred BUY in the sector and we reiterate our BUY rating with a TP of INR1,900 (premised on 1.9x Sep’25E ABV).

For all recommendations report, click here