IndusInd stock climbs despite setback, but road ahead looks rocky
Concerns around asset quality, governance and CEO succession still persist.
Synopsis IndusInd Bank shares recovered slightly despite reporting its first quarterly loss in two decades, yet analysts remain wary. Brokerages have cut earnings estimates, citing concerns about governance, asset quality, and the upcoming CEO transition. While some see potential value, a broader consensus anticipates a slow and uncertain turnaround for the bank. Mumbai: Shares of IndusInd Bank rose 1.8% to ₹785 Thursday, rebounding from early lows, as investors took the lender's first quarterly loss in 20 years in their stride. The stock was down 5.8% earlier in the day Analysts, however, remain cautious. Most brokerages have slashed earnings estimates and flagged concerns over governance, asset quality, and CEO succession. While a few see value if recovery takes hold, the broader view warns of a slow, uncertain turnaround.
ADVERTISEMENT UBS Sees significant uncertainty around the bank's future.
Warns of a potential drop in valuation due to multiple unresolved risks.
Morgan Stanley
Worst-case scenario is already unfolding.
Slow and painful earnings recovery, with a weakening high-return loan mix.
ICICI Securities Weak core profitability even after adjusting for one-offs.
Expects low loan growth and high credit costs, which will pressure return ratios.
ADVERTISEMENT CLSA 'A quarter to forget' with a ₹22billion loss from fraud, underperformance, and one-offs.
Microfinance book stress remains elevated.
HSBC
ADVERTISEMENT
Bank has reverted to pre-2009 quality levels.
Recovery path is unclear.
Jefferies
ADVERTISEMENT Clean-up was deeper than expected.
CEO transition as a critical factor for future recovery.
Macquarie
Stock is undervalued if the worst is over.
Concerns around asset quality, governance and CEO succession still persist.
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