IndusInd Bank - Q1 Result Update - Nirmal Bang

IndusInd Bank posted net earnings of Rs3.3bn for 1QFY14 aided by a 2bps QoQ expansion in margin and loan book growth of 27.3%, leading to net interest income (NII) growth of 40.4% YoY.

Asset quality remained stable, with GNPAs (gross non-performing assets) and NNPAs (net non-performing assets) at 1.06% and 0.21%, respectively.

While the asset quality of commercial vehicle loans was a tad higher at 1.17%, the margin looks unsustainable at the current levels.

We believe the stock is fairly valued at the current market price and its valuation has aptly factored in future earnings growth and likely positive news flow on overall growth and asset quality going forward.

We have retained our Hold rating on the stock with a target price of Rs510.

Source : Equity Bulls

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