Healthy loan growth likely to aid IndusInd Bank's income, profit in Q4: Analysts

IndusInd Bank is likely to clock 11 percent year-on-year (YoY) growth in net profit to Rs 2,261 crore in the January-March quarter (Q4FY24), backed by healthy interest income, as per average estimate of five brokerages. Net interest income is expected to see 18 percent YoY rise to Rs 5,496 crore, driven by strong credit growth.

IndusInd Bank is slated to report Q4 results on April 25, 2024. So far this year, the stock of this private lender has declined over seven percent, underperforming three-percent gain in the benchmark Nifty 50 index.

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Loan growth to outpace IndusInd Bank's deposits, say analysts

IndusInd Bank's loan growth is likely to outpace deposit trends, with the former pegged to rise by 17.5 percent YoY, while the latter is expected to climb by 14 percent YoY in Q4FY24, said analysts at Motilal Oswal.

At a time when financial majors are grappling with margin pressure due to higher cost of funds, analysts at Prabhudas Lilladher expects IndusInd Bank's margins to be stable among peers. They expect the lender's net interest margins (NIMs) to expand by 20 basis points (bps) to 4.83 percent in Q4FY24 from 4.62 percent in the year-ago period.

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Moderating credit costs to improve IndusInd's asset picture

IndusInd Bank's Asset-quality, too, is pegged to remain stable in the January-March quarter amid steady credit costs. Credit costs are expected to contract by 25 bps to 1.17 percent in Q4FY24 from 1.42 percent in the year-ago period, outlined Prabhudas Lilladher analysts.

IndusInd's gross net performing assets (GNPAs) is likely to moderate to 1.9 percent in Q4FY24 from 2 percent in Q4FY23, while net non-performing assets (NNPA) is seen at 0.5 percent in Q4FY24 from 0.6 percent in the year-ago period, said analysts at Motilal Oswal.

Following the release of IndusInd's Q4 results, investors can watch out credit cost trends, asset quality outlook, margin trajectory, and growth outlook.

In the March-ended quarter, foreign institutional investors (FIIs) have trimmed their stake in IndusInd Bank to 40.25 percent from 42.47 percent. Mutual funds, however, have upped their stake to 17.82 percent in the March quarter from 15.63 percent in December quarter.

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