 "indusind bank")
Private sector lender IndusInd Bank posted a 17.2 per cent year-on-year (Y-o-Y) rise in net profit to Rs 2,301.49 crore during the third quarter of financial year 2023-24 as compared to Rs 1,963.64 crore in the previous year. Steady growth in both interest income and other income aided profit growth.
The Net Interest Income (NII), which is the difference between interest earned and interest paid, stood at Rs 5,296 crore for the period, which was 17.81 per cent up from Rs 4,495 crore in the year-ago period. The other income rose by nearly 15.38 per cent to Rs 2,395.85 crore.
Meanwhile, the Net Interest Margin (NIM) of the lender stood at 4.29 per cent, inching up from 4.27 per cent, sequentially.
Speaking on the margins, Sumant Kathpalia, Managing Director & Chief Executive Officer, IndusInd Bank said that going forward, he expects the NIMs to remain range-bound between 4.2 to 4.3 per cent.
“We have the ability to manage our net interest margin because of the portfolios we have -- like microfinance, commercial vehicles, as well as our non-vehicle retail assets, where we are able to increase our pricing or demand the pricing which we want at a certain point of time and we've been very consistent with it,” he noted.
The operational cost of the bank rose by 27 per cent to Rs 3,650 crore from Rs 2,885 crore due to an increase in employee cost.
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Provisions of the bank during the three-month quarter ending December 31, 2023, stood at ₹969.25 crore as compared to Rs 1,064.73 crore.
The private sector lender noted that it has not made any additional provisions for the Alternate Investment Funds (AIFs) in this quarter as they have an exposure of ₹113 crore which they intend to sell down.
“We have ₹113 crore exposure [in AIF], which I think we are about to sell down. I think it earns an 18 per cent yield for us, and if we have to sell it out, there is enough demand in the market,” Kathpalia said while adding the bank is unlikely to make provision for the AIF exposure.
The asset quality of the lender was healthy, with Gross Non-Performing Assets (GNPA) being at 1.92 per cent in Q3 FY24 as compared to 1.93 per cent in Q2, and Net NPA staying flat at 0.57 per cent across the time period.
The bank’s capital adequacy ratio was at 17.86 per cent as of the end of December, declining from 18.21 per cent in the previous quarter.
IndusInd Bank’s gross advances rose by 20 per cent to ₹3.27 trillion from ₹2.73 trillion, whereas the deposits rose by 13 per cent to ₹3.69 trillion as against ₹3.25 trillion in the year-ago period.
As of December 31, 2023, IndusInd Bank’s distribution network included 2,728 branches and 2,939 onsite and offsite ATMs, as against 2,384 branches and 2,894 onsite and offsite ATMs as of December 31, 2022. The client base stood at 38 million as of December 31, 2023.
IndusInd Bank added 98 branches in the December 2023 quarter and is also planning to open 4 more branches in Ayodhya in addition to the existing one.
