IndusInd Bank Q2 Preview: Loan Growth, Provision Cuts to Boost Profits

is seen as reporting a strong set of numbers for the quarter ended September thanks to healthy growth in the loan book and lower loan loss provisions.

The bank’s net profit for the quarter is expected to rise 55% year on year to Rs 1,728.3 crore, according to the average of estimates given by six brokerage houses.

Net interest income (NII) is expected to rise by 18% year on year to Rs 4,302 crore, according to estimates.

IndusInd Bank will release its results on Wednesday.

Provisional figures released by the private sector lender showed advances increased by 18% year on year to Rs. 2.59 lakh crore as of September 30. Deposits increased by 15% to Rs. 3.2 billion.

Retail deposits and deposits from small business customers stood at Rs. 1.29 lakh crore as of September 30, compared to Rs. 1.24 lakh crore a quarter ago.

“IndusInd’s performance on retail deposits is also good given that it now offers a premium of 60-70 basis points on popular slabs over the big banks, which is well below the premium of 150 basis points + that it offered two years ago,” said Nuvama Wealth Management. in his report.

On the operating performance front, brokerage firm Kotak Institutional Equities expects the bank’s operating profit to be flat for the year, due to a lower contribution from cash.

The Treasury portfolios of most banks have been affected in the past quarter due to the sharp rise in government bond yields.

Non-interest income is expected to be subdued due to lower treasury income, while NIM net interest margin is expected to be flat at 4%, Kotak Equities said.

During the June quarter, the bank’s NIM rose 15 basis points year on year to 4.2% and was flat sequentially.

The trajectory of credit costs will be a controllable key. brokerage house

Securities expects credit costs to gradually moderate as the focus remains on maintaining a higher provision coverage ratio.

The brokerage expects IndusInd Bank to declare provisions in the amount of Rs. 1,170 crores for Q2, which is lower than Rs. 1,700 crores made in the same period last year.

The bank’s performance on the asset quality front will be watched, as the lender had seen non-performing assets rise in the first quarter.

(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)


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