- 25 Oct 2024
- ICICI Securities
INDUSIND BANK REPORTED Q2FY25 RESULTS, WHEREIN ADVANCES ROSE
News: IndusInd Bank reported Q2FY25 results, wherein advances rose 13.2% YoY (2.7% QoQ) to ₹3,57,159 crore led by a 16% YoY rise in corporate loans. Slowdown in MFI segment (12% QoQ de-growth) led to muted NII growth at 5.3% YoY (1.1% QoQ decline), causing NIM to contract by 21 bps YoY (17bps QoQ) to 4.08%. Absence of PSLC fees, lower treasury and loan processing fees as well as higher provisions (including contingent buffer of ₹525 crore) declined PAT to ₹1,331 crore (~40% YoY & QoQ), with RoA falling 70 bps QoQ to 1%. Asset quality deteriorated with GNPA & NNPA rising by 9bps/4bps QOQ to 2.11% & 0.64%. Deposit accretion came at 14.7% YoY (3.5% QoQ) to ₹4,12,397 crore, supported by 16% YoY retail deposit gains, with CASA ratio at 36%.
Views: Profitability significantly impacted by higher contingent provisions combined with slight deterioration in asset quality & slowdown in MFI segment keep pressure on margins. Contingent provision in challenging quarter remained unexplained. Management's maintains guidance on credit cost and revival in business growth especially high yielding segment.
Impact: Negative