IndusInd profit zooms 51% on higher income, lower provisions

IndusInd Bank’s consolidated net profit for the January-March quarter rose 51% year-on-year (y-o-y) to Rs 1,401 crore on the back of higher income and lower provisions. The net interest income (NII) grew 12.7% y-o-y to Rs 3,985 crore, other income was up 7% to Rs 1,905 crore and the net interest margin (NIM) rose 10 basis points (bps) sequentially to 4.2%. Provisions were down 22% y-o-y to Rs 1,463.52 crore.

Sumant Kathpalia, managing director and CEO, said all retail products saw the highest levels of disbursements ever for the bank during the quarter. Corporate loans also maintained a steady momentum, led by small companies. “Strong retail disbursements and falling costs of deposits helped improve our net interest margin to 4.2% from 4.1%. Overall, our profit margins remain healthy at 5.8% for the quarter,” Kathpalia said.

The advances book grew 12% on a y-o-y basis to Rs 2.39 trillion and deposits rose 15% y-o-y to Rs 2.93 trillion. Current account savings account (CASA) deposits comprised 43% of total deposits at the end of Q4, up from 42% a year ago.

Restructured advances constituted 2.6% of the loan book, down from 3.3% in Q3FY22. “On the asset quality and provisioning front, our stressed pool has seen meaningful reduction across categories such as net slippages, recast book and overdue in microfinance,” Kathpalia said, adding that the bank has, nevertheless, maintained contingent provisions at Rs 3,328 crore,  taking a conservative approach.

Slippages were at Rs 2,088 crore in Q4, down from Rs 2,598 crore in the previous quarter. The bank made recoveries worth Rs 716 crore and upgrades worth Rs 281 crore during Q4. Gross non-performing assets (NPAs) stood at 2.27% of advances as on March 31, 2022, down from 2.48% as on December 31, 2021. The net NPA ratio stood at 0.64%, down from 0.71% a quarter ago.

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