Despite IndusInd Bank Ltd reporting a beat on Q4 net profit and in-line net interest income (NII) for the March quarter, driven by lower opex and credit costs, analysts largely maintained a ‘Hold’ rating on the stock. Analysts noted that the management is targeting loan growth in line with the system in FY27 and a return on assets (RoA) of 1 per cent by Q4FY27, supported by moderation in credit costs and improved earnings growth. A couple of brokerages suggested price targets for the stock in the range of Rs 760-950. The stock closed at Rs 850 on Friday, implying a wide dispersion in outlook, with potential upside or downside of about 11 per cent.

Nuvama Institutional Equities said it believes earnings and credit costs may improve for IndusInd Bank, but the trajectory towards normalised loan growth remains challenging. "The stock currently trades at 1x FY27E P/BV; retain ‘HOLD’ with an unchanged target of Rs 900/1x FY27E BV," it said.

Sub-par growth

HDFC Securities, the sixth-largest Indian broker in terms of active clients in FY26, said IndusInd Bank's Q4 results beat its estimates on the back of lower-than-expected provisioning, even as the bank continued to de-grow credit book and improve its credit quality marginally. The growth was sub-par, it noted. 

"Credit growth (down 8 per cent YoY) was subdued with continued de-growth in wholesale and MFI segments. Deposit growth (down 3 per cent) was also muted with the CASA ratio improving to 31.2 per cent as IIB continues its endeavour to improve the granularity of its deposits. While the management has guided on growing its loan book close to system levels in FY27, we argue it is too early for the franchise to find growth accelerants," it said.

HDFC Securities cited multiple handicaps around a sub-par deposit franchise, inadequate provisioning buffers, and stress in its unsecured book that still needs fixing to maintained 'Reduce' and a target Rs 760.

Modest fee, treasury income

For MOFSL, the tenth largest broker, IndusInd Bank reported a decent quarter, supported by stronger NII and sharply lower-than-expected provisions, driven by improvement in slippages across segments. Consequently, RoA improved to 0.45 per cent from 0.1 per cent in Q3. It said other income remained subdued due to modest fee and treasury income, while opex declined sequentially. 

"NIMs expanded 4bp QoQ to 3.39 per cent (adjusted for one-offs in Q3). Business growth was modest, reflecting de-bulking of the corporate book and a strategic shift towards the mid-market segment. The reduction in slippages was broad-based, leading to lower provisions in 4Q versus expectations," it said.

This brokerage raised its earnings estimates by 14 per cent/18 per cent for FY27/28E and projected IIB’s RoA/RoE at 0.7 per cent/5.6 per cent for FY27E. It reiterated 'Neutral' on the stock with a target of Rs 950.