Buy IndusInd Bank; target of Rs 2248: Anand Rathi

Anand Rathi's research report on IndusInd Bank

Strong traction in IIB’s balance sheet continues. We note better headline asset quality parameters and are sanguine about its loan-growth prospects over FY19-20. The strategic BHAFIN deal would be synergistic in the medium term. We maintain our Buy recommendation.

Outlook

Our Jul’19 target of `2,248 is based on the two-stage DDM model. This implies a ~4.15x P/ABV multiple on its FY20e book. Risks: Lumpy slippages from the corporate book; any significant negative surprises on asset quality from the microfinance book, post-merger.