Shares of IndusInd Bank rose 1% on Monday after the bank posted a Q2 net profit of ₹1,242 crore, a sharp turnaround from the ₹437 crore loss reported a year earlier. The lift came as the bank’s filing showed net interest income growing 3.6% YoY to ₹4,569 crore, while operating profit excluding provisions jumped 40.4% to ₹2,875 crore.
Gross non‑performing assets fell to 2.73% from 3.25% in the prior quarter, and net NPAs eased to 0.83% from 0.95%. Net interest margin slipped sequentially to 3.23% as FCNR‑related yields tightened, though other income rose 36% YoY, buoyed by foreign‑exchange gains linked to FCNR deposits.
Management said loan growth will track industry trends, focusing on secured retail lending and SME exposure, and that the bank expects to reverse the NIM compression over the next two quarters. It reiterated a target of 1% return on assets by Q4 FY27, with a medium‑term aspiration of 1.75%‑1.8%.
Macquarie maintains an ‘Underperform’ rating with a ₹760 target price, citing the profit beat and stronger fee income but noting margin headwinds. UBS, meanwhile, downgraded the bank to ‘Sell’, setting a ₹870 target, and highlighted the 12% profit beat, improved fee income, and the pressure on NIM from FCNR deposits.
Analysts agree that while the Q2 results are encouraging, the bank’s path forward hinges on margin recovery and fee‑income expansion, with the next earnings report expected to clarify whether the 1% RoA goal will materialise.