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Informist, Monday, Apr. 20, 2026

By Krity Ambey

NEW DELHI – IndusInd Bank's earnings for the March quarter are expected to remain subdued following a fifth consecutive quarter of contraction in advances and deposits. But the quarterly earnings will still be better compared to the year-ago period, when the lender had posted a loss after provisioning for the discrepancies found in their derivative accounts last year.

The bank had posted a loss of INR 22.36 billion in the March quarter last year due to incorrect accounting, which led to a hit of nearly INR 20 billion on profits. But the hit to the bank's reputation continues to weigh on its advances and deposits. Provisional data shows IndusInd Bank's net advances fell nearly 9% to INR 3.15 trillion as of Mar. 31, and deposits declined nearly 3% to INR 4 trillion. 

IndusInd Bank's net profit for the March quarter is likely to nearly double sequentially to INR 3.15 billion, based on the average of estimates from 11 brokerage firms. But it is worth noting that the bank had incurred a one-time cost of INR 2.29 billion in the December quarter due to the new labour codes notified in November. If not for this cost, the bank's profit in Oct-Dec would have been INR 3.90 billion. Compared to the December quarter profit without extraordinary items, the consensus estimate for the March quarter is down 19%. Net profit forecasts vary from a low of INR 1.19 billion by Motilal Oswal Financial Services Ltd. to a high of INR 6.32 billion by Kotak Securities Ltd.

Analysts have flagged net interest margin, provisions, and slippage as key areas to monitor when the bank announces its March quarter earnings on Friday. They also await the management's commentary on asset quality, particularly in the microfinance portfolio.

The lender saw stress in its microfinance portfolio in the last two consecutive quarters. IndusInd Bank's provisions for bad loans had surged 20% on year in the December quarter and income had declined 14% on year, leading to an 89% on-year fall in its net profit to INR 1.61 billion. While brokerages expect some improvement in the microfinance segment, provisions are likely to remain high in the March quarter as well.

The net interest income of the bank is likely to jump 46% on year to INR 44.51 billion in the March quarter, according to the average of estimates from 11 brokerages, with the lowest projection at INR 42.47 billion by Motilal Oswal Financial Services and the highest at INR 45.94 billion by Elara Securities (India) Pvt. Ltd. Sequentially, the bank's net interest income is likely to fall 2%. 

Brokerages have given mixed views on the bank's net interest margin for Jan-Mar, with four out of seven projecting a sequential compression. The bank's net interest margin is expected to be in the range of 3.36% to 3.70% in the March quarter, according to the brokerages. The bank had reported a net interest margin of 3.52% at the end of the December quarter.

Analysts also await management's commentary on strategy, funding costs, and return ratios, particularly amid a leadership change at the bank. Following the discovery of accounting discrepancies last year, the then managing director and chief executive officer, and the chief financial officer quit, and a new management has been appointed. This will be the third quarterly results under the new management.

Of the 14 research reports on IndusInd Bank available with Informist, seven have a 'hold' recommendation, with an average target price of INR 906, 6% higher than the current market price. Four brokerages have a 'buy' recommendation with an average target price of INR 990, and three have a 'sell' recommendation for the stock with target price ranging from INR 720 to INR 910. Shares of IndusInd Bank, which have fallen nearly 5% since it announced the December quarter earnings, were trading 0.3% lower at INR 851.40, at 1350 IST, on the National Stock Exchange.  

Following are the December quarter earnings estimates for IndusInd Bank from 11 brokerages in descending order of the estimate of net profit in INR billion: 

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Tanima Banerjee

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