Shares of IndusInd Bank slumped 22.94% to Rs 465.65 on steep selling pressure.
The stock tanked 74.62% from its 52-week high of Rs 1,835 hit on 28 March 2019.In a major blow to the telecom companies, the Supreme Court on Wednesday said the telecom companies would have to pay the due adjusted gross revenue (AGR) amount as it's "public money". The Supreme Court said the telecom companies would have to pay interest and penalty as per its October 24 judgement.
IndusInd Bank after market hours on Tuesday (17 March 2020) clarified that it is financially strong, well-capitalized, profitable and a growing entity with strong governance. The bank issued the clarified in wake of the significantly higher level of market rumors and speculation around IndusInd Bank stock.
The bank said that in last quarter, its gross NPA at 2.18% was the 2nd lowest in the industry amongst large private sector banks. The bank expects current quarter gross NPA to be pretty much in line with that of last quarter.
It expects net NPA of 1.05% as at the last quarter to fall below 1%, in line with the bank's ambition to take provision cover beyond 60%.
Commenting on its exposure to telecom companies, the bank said relief measures for the telecom sector are under process of approval which is a significant positive step and the bank awaits further decisions/details in this matter.
The bank said its real estate developer (commercial and residential) book had zero gross NPAs. The gems and jewellery financing portfolio too had zero gross NPAs while commercial vehicle and microfinance portfolios remain steady and range-bound.
The bank said that market rumors about individual exposures doing the rounds are bloated and outlandish and nowhere near the truth. The bank said it makes full disclosures every quarter on its loan book profile.
The bank said that the promoter has sought RBI approval to increase shareholding to 26% and they await further guidance from the Regulator. Promoter has already informed the exchange about the simultaneous release of non-disposal undertaking with the creation of a pledge in relation to 23.8m shares of the bank. No new borrowing was undertaken and was merely a formalisation of a three year old arrangement. The money was originally raised to make an overseas acquisition which did not fructify - the pledge is a small fraction of promoter holding in the bank.
The bank said it maintains liquidity well above 100% going up to 120% on a dally basis. The deposit business of the bank on both retail and corporate segments is steady. However, a couple of state government entities have made withdrawals amounting to less than 2% of the bank's total deposits. The bank is engaging with them to reiterate the stance of the Regulator that government deposits in all private sector banks is safe. The bank has been a lender in the interbank market last week.
At 15.43% CRAR (including 9 month profits), the bank does not need capital for 2 years. All its banking with other banks and counterparties is business as usual. The bank said it continues to enjoy interbank lines/limits without interruption.
Various market rumors and speculation incorrectly reflect on the bank's financial health and are totally misplaced, motivated and not based on facts. lnduslnd Bank is committed to all its stakeholders and we would urge all our stakeholders to not believe unsubstantiated information and mischievous rumors, it said.
The bank has also proactively made all business continuity arrangements in light of the coronavirus so that our services remain uninterrupted, the health of our employees and customers is safeguarded, digital channels are propagated and daily business execution on the ground remains effective.
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