January 18, 2017 / 15:35 IST
IndusInd Bank’s (IIB) 3QFY17 PAT grew 29% YoY (5% beat) to INR7.5b, led by strong core operating profitability (4% beat). Asset quality remained stable QoQ, with GNPA at 94bp and PCR at 59%. Core PPoP growth was impressive at 30% YoY (+8% QoQ), helped by strong NII growth (35% YoY, 8% QoQ; 4% beat), healthy fees performance (+7% QoQ, 22% YoY) and a controlled C/I ratio (47%). Despite the impact of demonetization, IIB reported stable NIMs, led by a sharp fall (-25bp QoQ) in cost of funds (COF).
Outlook
Dominate (to be among the top three banks in home markets), Differentiate (extensive use of technology and cross-sell) and Diversify (new products). Strong core profitability (3% of avg. assets v/s private banks’ avg. of 2.5% and HDFCB’s 2.7%), an improving CASA ratio (best among mid-sized private banks) and healthy return ratios (RoA of 1.9%+ and RoE of 16-18%) are the key positives. Maintain Buy with a target price of INR 1,430 (up from INR1,400 due to roll over by a quarter; 3.4x December 2018 BV).
For all recommendations, click here 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. 
Read More
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
