Result Analysis: IndusInd Bank Limited (CMP: Rs.1223) Result Update: Q3FY23

IndusInd Bank is one of the fastest growing private bank in India engaged in providing a wide range of banking products and financial services to corporate and retail clients. It is the fifth largest private bank in India promoted by the Hinduja group. The products and services offered by the bank includes microfinance, personal loans, personal and commercial vehicles loans, credit cards, SME loans. The bank is working with a widespread network of over 2,384 branches and 6,000 distribution points along with 2894 ATMs across country.


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    Stock Details
    Market Cap. (Cr.) 94795
    Equity (Cr.) 775.42
    Face Value 10
    52 Wk. high/low 1275 / 764
    BSE Code 532187
    Book Value (Rs) 651.92
    Sector Banks


    Key Ratios
    ROE (%): 10.57
    TTM EPS: 78.39
    P/BV: 1.9
    TTM P/E: 15.60

    Result Highlights:

    • IndusInd Bank has reported 58% YoY and 8.8% QoQ increase in the consolidated net profit for the December quarter’ 22 to Rs.1,964 cr.

    • Net Interest Income of the bank grew by 18.5% YoY and 4.5% QoQ to Rs.4,495 cr. Net Interest Margin increased by 3 bps on QoQ and 17 bps on YoY basis to 4.27%.

    • Banks’s total advances grew to Rs.2.73 lakh cr. by 19.3% YoY in Q3FY23 compared to Rs.2.29 lakh cr. in Q3FY22.

    • Total deposits aggregated to Rs.3.25 lakh cr. as of December 31, 2022, a growth of 14.3% over Rs.2.84 lakh cr. for the same period of FY22 and a growth of around 3.1% over Rs.3.16 lakh cr. as of September 30, 2022.

    • On yearly basis, corporate advances grew by 20% and consumer loans grew by 18.4%. Out of the total consumer loans segment, vehicle loans grew by 18%, non-vehicle loans grew by 27% and Microfinance grew by 8%.

    • CASA deposits of the bank grew by 14% YoY to Rs.1.36 lakh cr. with savings account deposits at Rs.86,372 cr. and current account deposits at Rs.50,007 cr. CASA ratio remained unchanged on YoY and QoQ basis at 42%.

    • Asset quality of the bank remained stable in the quarter with Gross NPA of 2.06% decrease of 42 bps YoY and Net NPA ratio at 0.62% decrease of 9 bps YoY. Bank has added 1467cr. in the total slippages vs 1572 cr. in the previous quarter.

    • Bank has added 64 branches and 87 ATMs in the quarter, aggregated to total 2384 branches and 2894 ATMs at the end of December 31, 2022.


    Financial Performance:


    Shareholding Pattern:

    Particulars %
    Promoters & Promoter Group 15.16
    FIIs 42.52
    DIIs 23.03
    Public 16.08
    Others 3.21

    Management Commentary:

    Commenting on December quarter performance, Sumant Kathpalia, Managing Director & CEO, said, IndusInd Bank continued its growth momentum across metrics. Bank’s loan growth was at 19% YoY with all segments contributing to the growth. GNPA was lower at 2.06% and NNPAs range bound at 0.62% with a healthy PCR of 71%. Bank’s Core Operating Profit grew by 11% YoY bolstered by better NIMs and healthy client fees. Profit after Tax was at ₹1,964 crores growing 9% QoQ and 58% YoY. The Bank remains on track to achieve its strategic ambitions and having financial metrics in the top quartile of the industry.


    IndusInd Bank reported highest ever revenues and stable asset quality in the December quarter’22 with the 18.5% YoY growth in the Net Interest Income and 58% growth in the Net profits. Bank has shown strong credit growth of 19% on YoY basis led by growth across all segments. Management of the bank expects, 20%-25% credit growth over medium term and NIM to be in the range of 4.15-4.25% range. IndusInd Bank has delivered the earnings of Rs.69.67 in the last 9 months and we expect the bank to close FY23 at the estimated EPS of Rs.93.29. The P/BV of the bank stands at 1.88x at the current market price of Rs.1223 and on the basis of estimated earnings the PE of the bank stands at 13x on current price.


    Particulars (In Rs. Cr.) Q3FY23 Q2FY23 Q3FY22 QoQ% YoY% 9M FY23 9MFY22 FY22
    Interest earned 9,457 8,708 7,738 8.6% 22.2% 26,347 22,963 30,822
    Interest Expended 4,962 4,406 3,944 12.6% 25.8% 13,425 11,947 15,822
    Net Interest Income 4,495 4,302 3,794 4.5% 18.5% 12,923 11,016 15,001
    Operating Profit 3,686 3,544 3,312 4.0% 11.3% 10,662 9,655 13,035
    Provisions 1,065 1,141 1,654 -6.7% -35.6% 3,457 5,140 6,602
    Net Profit after tax 1,964 1,805 1,242 8.8% 58.2% 5,400 3,404 4,805
    Deposits 3,15,532 3.1% 14.3% 3,25,278 2,84,484 2,93,349
    Advances 2,60,129 4.9% 19.3% 2,72,754 2,28,583 2,39,052


    Ratios (%) Q3FY23 Q2FY23 Q3FY22 QoQ% YoY%
    Gross NPA 2.06 2.11 2.48 -5 bps -42 bps
    Net NPA 0.62 0.61 0.71 1 bps -9 bps
    Provision Coverage Ratio 71 72 72 -100 bps -100 bps
    Net Interest Margin 4.27 4.24 4.1 3 bps 17 bps
    Capital Adequacy Ratio 18.01 18.01 18.06 -5 bps
    CASA Ratio 42 42 42
    Source: Company website, EWL Research

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