Stock market today: IndusInd Bank shares jump after Q4 results. Buy, say experts

IndusInd Bank share price today surged over 2% in early morning deals

Stock market today: After announcement of Q4FY23 results yesterday, IndusInd Bank shares have been in uptrend since morning deals on Tuesday. IndusInd share price today opened upside and went on to hit intraday high of ₹1,127.60 apiece on NSE, logging around 2.30 per cent rise within few minutes of stock market's opening bell today.

According to stock market experts, IndusInd Bank has reported a decent fourth quarter results for the financial year 2022-23, and market is reacting to the good quarterly numbers announced by the private lender. They said that the banking stock looks positive and it may go up to ₹1600 apiece levels in long term.

Why IndusInd Bank shares are rising?

On why IndusInd Bank shares are surging today, Shreyansh Shah, Research Analyst at Stoxbox said, "IndusInd Bank has delivered a decent performance in the fourth quarter, with good momentum seen across its businesses such as retail and corporate segments. The bank’s key metrics also showed an improving trend including NII, RoA and RoE along with better metrics on the asset quality side. We believe that the company would likely garner higher market share and manage risks through greater diversification going forward. We believe that a well-capitalized balance sheet, improvement in collection efficiencies across business segments (vehicle and MFI being the key), lower credit costs, conservative provisioning and strong focus on risk management framework would help the company to command a higher valuation multiple going forward."

Highlighting upon the positives from the IndusInd Bank results, Anand Dama, Senior Research Analyst at Emkay Global Financial Services said, "Despite the slight miss on NII and higher opex, IndusInd bank reported a largely in-line PAT at Rs20.4bn (up 46% YoY)/RoA at 1.8%, led by lower LLP, as the bank continues to utilize the contingent buffer – to the tune of Rs2.9bn during 4Q – which now stands at Rs19bn/0.7% of loans. Slippages were higher QoQ at Rs16bn/2.7% of loans, due to relapse in the MFI and corporate (ACB coal washery) restructured pool."

Anand Dama went on to add that credit growth was strong at 21% YoY/6% QoQ, led by growth across retail loans (up 21% YoY/7% QoQ) and the corporate and SME/BB book. Management conservatively guides for a broad growth range of 18-23%, factoring-in the macro-uncertainty, but expects better margins at 4.25-4.35% in FY24, as it benefits from the rate reversal cycle and the increase in retail portfolio share.

Giving 'portfolio stock' tag to IndusInd Bank shares, Anand Dama said, "We retain BUY on the stock, with revised TP of Rs1,600/share, valuing the bank at 1.9x Mar-25E ABV (vs 2x Dec-24E ABV earlier). We believe the MD's shorter-term extension (2 years vs the expected 3 years) is largely in the price, while the near-to-medium stock performance will track the growth, asset quality and RoA trajectory."

IndusInd Bank results

IndusInd Bank exceeded the market estimates by reporting standalone net profit of ₹2,040.51 crore in Q4FY23, an increase of nearly 50 per cent against the net profit of ₹1,361.37 crore in Q4FY22. The private lender went on to announce an increase of near 17 per cent in its net income in Q4 results for the financial year 2022-23.

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