JM Financial is bullish on IndusInd Bank has recommended buy rating on the stock with a target price of Rs 2120 in its research report dated July 10, 2018.
JM Financial's research report on IndusInd Bank
IndusInd reported a stable 1QFY19 with 24% YoY growth in earnings driven by 29% growth in loans and 20% growth in core fees. Core-PPOP grew 27% YoY during the quarter even as NII growth was a tad soft at 20% YoY. NIMs tapered by 5bps QoQ to 3.92% led by higher cost of funds and, in our view, also a reflection of bank's own efforts to improve the risk profile of the corporate portfolio before onboarding of BHAFIN's loan book. As BHAFIN acquisition closes towards 2HFY19, we expect IIB's margin trajectory to remain strong and loan portfolio to be well balanced and diversified. Opex growth was contained at 12% YoY due to slightly slower network expansion during the quarter (10 branches added).
We continue to like Indusind for its balanced portfolio mix, strong medium-term growth trajectory and healthy earnings growth. We maintain our BUY rating on the stock with unchanged TP.
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