IndusInd Bank Q1 Review - Healthy Recoveries; Asset Quality Risks Remain: Dolat Capital
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Dolat Capital Report
IndusInd Bank Ltd.’s operating metrics were in-line, with net interest income and pre-provision operating profit growing by 8%/11% y-o-y respectively.
Net interest margin decline q-o-q to 4.1% and was adversely impacted by higher liquidity during the quarter, interest reversals, and limited decline in cost of fund.
High treasury gains partly supported operating profits (3.5%), with core PPoP/assets lower at 2.8%.
On asset quality, while slippages were elevated at 5.2%, increase in gross non performing asset was limited to 20 basis points as upgrades/recoveries were strong.
At 5.2% of advances, slippages were in line with expectations, 62% of which came from vehicle and micro finance institution portfolio.
However, IndusInd Bank also had good recoveries from MFI, resulting in net slippages of 3.6% from the segment.
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