Earnings Outlook
Indian Bank Q3 PAT seen up 10% YoY on better asset quality
This story was originally published at 20:30 IST on 20 January 2026
Register to read our real-time news.Informist, Tuesday, Jan. 20, 2026
By Divya Moolayattil
MUMBAI - Indian Bank is expected to report a low double-digit year-on-year increase in its December quarter net profit, supported by steady loan growth, strong fee income, and easing asset quality pressures, according to brokerages tracking the bank.
Indian Bank is expected to report a net profit of INR 31.4 billion, up 10% on year and nearly 4% on quarter, according to the average of estimates from five brokerages. The highest estimate for Indian Bank's net profit for the December quarter is INR 32.0 billion by Elara Securities Pvt. Ltd and the lowest is INR 30.8 billion by YES Securities (India) Ltd.
The state-owned bank's net interest income for the December quarter is likely to be INR 67.2 billion, up nearly 3% sequentially, according to the average of estimates. Estimates for the bank's net interest income range from INR 67.5 billion by Elara Securities to INR 66.8 billion by Emkay Global Financial Securities Ltd.
The bank's net interest margin for the December quarter is expected to be around 3.2%, a decline of 25-28 basis points on year and 3-6 bps on quarter, according to estimates from three brokerages. The sequential decline in the net interest margin is due to the impact of Reserve Bank of India's cumulative 125 bps cut in its benchmark repo rate in 2025, which is partly offset by a fall in savings and term deposit rates, YES Securities said in its pre-earnings report.
The Chennai-based bank's gross advances grew 14.5% on year to INR 6.40 trillion in the December quarter. Loans to the domestic retail, agriculture, and micro, small and medium enterprises segment rose 17% on year to INR 3.92 trillion. The total deposits were up 12.5% on year to INR 7.90 trillion in the reporting quarter, but the domestic current account savings account ratio fell to 39% from 40% a year ago.
The lender's other income for the December quarter is expected to be around INR 25 billion, a sequential rise of nearly 16%, Emkay said in a report.
The bank's gross non-performing assets ratio is estimated at 2.3% as of Dec. 31, a decline of 96 bps on year and 20 bps on quarter. Continued strong recovery, write-offs, and improving credit growth will drive the reduction in gross non-performing assets, according to Emkay.
The public sector bank's provisions are estimated at INR 7.1 billion-7.6 billion, a 28-33?cline on year and a 3.7-3.9?cline on quarter, according to the brokerages. The provisions are lower in the December quarter due to the expected credit loss adjustments booked in the trailing quarter, according to YES Securities. Slippages are likely to be higher on a sequential basis due to increased stress in agri loans, a seasonal phenomenon in Q3.
Shares of Indian Bank are up nearly 10% since its September quarter earnings were announced. Tuesday, the bank's shares ended at INR 846.60 on the National Stock Exchange, down 1.4% from the previous close. Indian Bank will announce its December quarter earnings Thursday.
All six brokerage reports on the bank available with Informist have 'buy' recommendations on the stock, with an average target price of INR 866 per share. This is over 2% higher than the current market price.
The following are the December quarter earnings estimates for Indian Bank from five brokerages in descending order of the estimates of net profit in INR billion:
|
Company Name |
NII |
Net Profit |
|
Elara Securities (India) Pvt. Ltd. |
67.5 |
32.0 |
|
Systematix Shares and Stocks (India) Ltd. |
67.1 |
31.51 |
|
Emkay Global Financial Services Ltd. |
66.8 |
31.50 |
|
Motilal Oswal Financial Services Ltd. |
67.4 |
30.93 |
|
YES Securities (India) Ltd. |
67.2 |
30.83 |
|
Average |
67.2 |
31.35 |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Saji George Titus
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