Company Update : IndusInd Bank Ltd By Motilal Oswal Financial Services Ltd
Advances decline sharply amid sell-down
IndusInd Bank (IIB) released its quarterly update, highlighting the key business numbers for 4QFY25. Following are the key takeaways:
* IIB reported a 5.2% QoQ drop in net advances (up 1.4% YoY) to INR3.48t. The decline in advances growth was led by a 4.9% QoQ and 15.1% YoY drop in corporate banking, while the consumer business grew 3.4% QoQ/6.3% YoY.
* Deposits growth remained subdued, rising 0.4% QoQ (6.8% YoY) amid a decline in retail and deposits from small business customers.
* CASA mix further moderated to 32.8% vs 34.9% in 3QFY25 and 37.9% in 4QFY24.
* The decline in advances growth led to a sharp decline in the CD ratio to 84.6% (down 464bp YoY and 498bp QoQ).
* IIB’s overall business performance was disappointing, with a sharp decline in advances growth, as the bank sold its corporate loan portfolio to manage deposit outflows amid withdrawals by retail and small business customers. We maintain a Neutral rating on the stock.
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