IndusInd Bank crashes by more than 20% today; Here’s why

This troubled  Bank Stock has fallen below its 20 percent lower circuit after announcing a discrepancy with their Derivatives portfolio, amounting to 2.35 percent of their Net worth.  

Share Price Movement

With a market capitalization of Rs. 56,130 Crore, the stock of IndusInd Bank opened at Rs. 810.55, at 10 percent lower circuit from yesterday’s close, and after opening it made a low of Rs. 696, i.e, 22.66 percent down. Additionally, the Yearly return for the stock is -53 percent, and the past 5-year return is -10 percent.

Update from Company

Company conducted an internal review and found out about a discrepancy in its derivative portfolio. The review identified discrepancies that could have an estimated negative financial impact of around 2.35 percent of the Bank’s Net worth, which could be an amount close to Rs. 1,500 Crore, that will have a direct impact on the Bank’s Net Profit.

During the analyst call, the Chief Executive and managing director, Sumant Kathpalia of the Bank said that general reserves cannot be touched, and we’ll have to take it to the P&L. The Review of the Portfolio was done by the bank, following the RBI’s Master Direction on Investment Portfolio of Commercial Banks 2023. 

Also read: Stock with orderbook of over ₹15,000 Cr trading at discount of 42% to add to your watchlist

Financial Highlights

The company reported a 10.62 percent YoY increase in revenue from Rs. 11,572 Crore in Q3FY24 to Rs. 12,801 Crore in Q3FY25. On a QoQ basis, the company reported an increase of 0.90 percent in revenue from Rs. 12,686 Crore in the previous quarter.

Their Net profit saw a decrease of 39.03 percent YoY from Rs. 2,298 Crore to Rs. 1,401 Crore for the same period. On a QoQ basis, the company reported a decrease of 5.73 percent in Net profit from Rs. 1,325 Crore in the previous quarter.

About the Company

IndusInd Bank is a leading private-sector bank in India, known for its strong financial services and customer-centric approach. It offers a wide range of banking products, including retail and corporate banking, wealth management, loans, and digital banking solutions.

Written By Abhishek Das 

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