InvestorQ : What explains the sharp profit growth of IndusInd Bank in the quarter?
Mitali Bhutta made post

What explains the sharp profit growth of IndusInd Bank in the quarter?

Answer
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1 month ago
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For the September 2022 quarter, IndusInd Bank reported 12.9% higher revenues at Rs10,719 crore. Top line growth was largely driven by a sharp growth in revenues from corporate banking, where the bank has put a lot of focus in the last few quarters. The revenues from treasury were lower on yoy basis as were the revenues from the retail banking vertical. The bank has comfortable contingency provisions of Rs2,653 crore and a rather strong capital adequacy ratio at 18.01%. This is well above the minimum statutory requirement prescribed by the Basel standards.

IndusInd Bank

Rs in Crore

Sep-22

Sep-21

YOY

Jun-22

QOQ

Total Income (Rs cr)

₹ 10,719.20

₹ 9,491.65

12.93%

₹ 10,113.29

5.99%

Net Profit (Rs cr)

₹ 1,805.28

₹ 1,146.73

57.43%

₹ 1,631.14

10.68%

Diluted EPS (Rs)

₹ 23.26

₹ 14.79

₹ 21.03

Net Margins

16.84%

12.08%

16.13%

Let me now turn to the profit performance for Q2FY23, which was your essential question. For the quarter ended September 2022, the PAT grew by 57.4% at Rs1,805 crore. This was largely spurred by a 33% fall in the provisions for bad and doubtful debts. In terms of asset quality, the gross NPAs fell from 2.77% to 2.11% yoy while net NPAs fell from 0.80% to 0.61% yoy, indicating that potential losses are substantially provided for. PAT margins were higher at 16.84% in Sep-22 quarter compared to 12.08% in Sep-21 quarter and as against 16.13% in June 2022 quarter.

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