Should you buy, hold or sell IndusInd Bank shares after robust results?

IndusInd Bank share price: The IndusInd Bank stock is in focus on Thursday, a day after the private sector lender reported a robust set of financial results for the October-December period with improvement in core income, margin as well as asset quality. Many global brokerages are upbeat on the bank's prospects, suggesting a potential upside of up to 32 per cent in the stock.

After market hours on Wednesday, IndusInd Bank reported a 58 per cent year-on-year jump in net profit to Rs 1,964 crore for the quarter ended December 2022. The private lender's net interest income -- or the difference between interest earned and interest paid -- grew 18 per cent to Rs 4,495 crore, driven by 19 per cent loan growth. 

Also Read: IndusInd Bank Q3 Results: Profit jumps 58% to Rs 1,964 crore as margin improves; asset quality stable

Its net interest margin -- a key measure of profitability for banks -- improved by 17 basis points to 4.27 per cent.

IndusInd Bank's overall deposits increased 14 per cent on the back of retail deposits. 

IndusInd Bank's gross non-performing assets as a percentage of total loans improved to 2.06 per cent from 2.11 per cent three months ago and 2.48 per cent in the corresponding period a year ago.

What brokerages say 

Jefferies maintained a 'buy' rating with a target price of Rs 1600 per share as the profit was tad ahead of estimates. It said that the net income interest (NII) growth was healthy, and the slight rise in net interest margins (NIMs) is encouraging.

Another global brokerage Credit Suisse maintained an Outperform rating with a revised target price of Rs 1430 from Rs 1400 per share earlier on the back of a steady quarter. It said that the return on equity (RoE) of the bank is on track and expects it to improve to 16 per cent, going forward.

CLSA also bullish on IndusInd Bank and maintains a Buy call with a target price of Rs 1500 per share as Q3 is seen largely in line on core PPoP and PAT. It said, the NIMs are also in-line with increased corporate book yields offsetting the higher cost of funds, and loan growth too remained strong in Q3.

Indusind Bank shares on Thursday are inching higher as the counter jumped nearly 2 per cent to Rs 1244.45 per share on the BSE.