IndusInd Bank has been making headlines for both good and bad reasons. While the bank reported strong growth in deposits and loans, it also faced a major accounting issue that led to a huge drop in its stock price.
Here’s a simple breakdown of what’s happening with IndusInd Bank.
1. Strong Growth in Business
In the June quarter, IndusInd Bank showed strong financial performance:
- Loans given (Net Advances): ₹2.89 lakh crore (Up 21% from last year)
- Deposits collected: ₹3.36 lakh crore (Up 15% from last year)
- Retail & Small Business Deposits: ₹1.5 lakh crore (Up from ₹1.43 lakh crore in March 2023)
- CASA Ratio (Current & Savings Account deposits): Dropped from 43.2% to 40.1%
This means the bank is growing and getting more business. However, the real problem started when an accounting issue was revealed.
2. Mutual Funds Sold IndusInd Shares Before the Big Crash
Before the accounting issue became public, mutual funds sold a massive ₹1,600 crore worth of IndusInd Bank shares in February.
Some major sellers were:
- Kotak Mutual Fund → Sold ₹510 crore worth of shares
- Motilal Oswal Mutual Fund → Sold ₹126 crore worth of shares
- PPFAS Mutual Fund → Reduced their stake
Interestingly, Quant Mutual Fund saw an opportunity and bought ₹305 crore worth of shares in February.
3. Stock Crashes 27% After Accounting Issue
On March 11, IndusInd Bank’s stock crashed by 27% after the bank announced problems in its derivatives accounting before April 1, 2025.
- Estimated Loss: ₹1,577 crore
- Market Value Lost: ₹20,000 crore
- F&O Ban: IndusInd Bank was put under the Futures & Options (F&O) ban, meaning no new trading positions could be made.
4. IndusInd Bank CEO’s Assurance
IndusInd Bank’s MD & CEO, Sumant Kathpalia, said that despite this issue:
- The bank will still make a profit in the March quarter
- This is a one-time problem, not a long-term issue
On March 13, the stock recovered 4.4%, closing at ₹684.7, but it is still under trading restrictions.
5. What’s Next for IndusInd Bank?
- The bank is still financially strong, but investor confidence is shaken.
- The stock may remain volatile in the short term.
- Investors are waiting to see how the bank fixes the issue before making further decisions.
Final Thoughts
IndusInd Bank is facing a tough time due to its accounting issue, but its core business is still growing. Some investors see this as a buying opportunity, while others are staying cautious.
(Disclaimer: The information provided in this article is for educational and informational purposes only and should not be considered as financial or investment advice. Stock market investments are subject to market risks, and past performance does not guarantee future results. Before making any investment decisions, please conduct your own research or consult a certified financial advisor. The author and InvestChey are not responsible for any financial losses or decisions made based on this article.)
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