Shares of IndusInd Bank, a private bank facing troubles, first dropped but then went up on Thursday, May 22. This happened after the bank announced a big loss for the quarter ending in March 2025.
IndusInd Bank reported a loss of Rs 2,329 crore in the last quarter. This is a big change from a profit of Rs 2,349 crore in the same quarter last year.
The bank earned Rs 3,048.3 crore as Net Interest Income (NII) in this quarter. However, it had to set aside Rs 2,522.08 crore for possible bad loans and other expenses, which is more than the Rs 1,743.63 crore it set aside in the previous quarter.
The bank’s bad loans have also increased. The Gross Non-Performing Assets (NPA) went up to 3.13% from 2.25% last quarter. The Net NPA also rose to 0.95% from 0.68% last quarter.
Read More: Bank of Sydney Has Chosen Infosys Finacle Digital Banking on AWS Cloud
This is the first report since the bank found major accounting problems and faced audits and resignations of top leaders.
Sunil Mehta, the bank’s chairman, said the bank has fully accounted for these problems in this year’s financial report and wants to start fresh in the new financial year.
At 9:35 am, the bank’s shares were trading at Rs 777.8 on the NSE, up by 1% after dropping as much as 4% earlier.
What should investors do?
Experts at Emkay Global said this quarter was one of the worst for IndusInd Bank. The bank is dealing with big losses and the entire top management team resigned due to accounting issues. They think this will hurt the bank’s business and profits for the next few years. Because of this, they lowered their profit estimates for the bank from 2026 to 2028 and advised investors to ‘reduce’ or sell the stock. They also cut the target price from Rs 725 to Rs 650.
The new CEO will have a tough job fixing internal controls, improving governance, and changing the bank’s asset mix. This means earnings might grow very slowly for the next two years, according to Nuvama Institutional Equities. They also gave a ‘reduce’ rating and lowered the target price from Rs 750 to Rs 600.
CLSA kept a ‘hold’ rating but cut the target price to Rs 725 from Rs 780, calling this quarter one to forget and expecting a lot of uncertainty in 2026.
Also Read: Massive Bank Fraud Exposed: ED Has Arrested Ex-UCO Bank CMD Goel
HSBC downgraded the stock from ‘buy’ to ‘reduce’ but raised the target price slightly to Rs 660 from Rs 770. They said the bank is back to where it was before 2009 with no clear plan to improve yet. HSBC also cut earnings estimates for 2026 and 2027 by 41-43% because of accounting fixes.
Morgan Stanley also downgraded the bank to ‘underweight’ from ‘equal-weight’ and lowered the target price to Rs 700 from Rs 755. They pointed out a big miss in earnings and concerns about wrongly classified bad loans.
Disclaimer: The views expressed by experts are their own. Please consult a certified financial advisor before making investment decisions.
