Shares of IndusInd Bank Ltd hit a fresh 52-week high today after brokerage Morgan Stanley raised its target price to Rs 1,725 from Rs 1,525 earlier. The new target amounts to a 32% upside to the previous close on BSE. Morgan Stanley said the midcap private banks are likely to outperform the banking sector stocks.
The banking stock gained 2.52% to Rs 1336.25 today against the previous close of Rs 1303.35 on BSE. The stock of the lender has gained 9.18% this year and risen 44.35% in the last one year. Total 0.70 lakh shares of the firm changed hands amounting to a turnover of Rs 9.32 crore on BSE. Market cap of the bank rose to Rs 1.03 lakh crore.
In terms of technicals, the relative strength index (RSI) of IndusInd Bank stands at 72.4, signaling it's trading in the overbought zone. The banking stock has a one-year beta of 1.4, indicating very high volatility during the period. IndusInd Bank shares are trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.
The stock hit a 52-week low of Rs 763.75 on June 23, 2022.
In April end, ICICI Direct assigned a target price of Rs 1,450 on the private sector lender. It maintained buy call on the lender based on the triggers below.
1. The management has introduced planning cycle - 6 (FY23–26) wherein they have guided for 18-23% YoY credit growth, mainly driven by retail (55-60% proportion) and PPOP margins to be 5.25-5.75%
2. Focus on new business verticals (home loan) to aid business growth and gain market share. Uptick in NIMs led by higher share of retail loans including micro-finance segment
3 Ramping up phygital distribution channels to keep CI ratio elevated for couple of quarters. However, improvement in credit cost will boost earnings growth and return ratio
In March-end, brokerage Jefferies said the banking stock was its top pick in the sector. It pegged an upside of 55% and assigned a target price of Rs 1,550 on the banking stock.
On March 14, brokerage Sharekhan assigned a target of Rs 1400 for the private sector lender. That time, the market price of IndusInd Bank was Rs 1072.2.
“IndusInd Bank (IIB) has recovered from its past challenges and has been progressing well on guided lines. Strong growth potential from a well-diversified loan book with a rising share of retail loans along with healthy capital ratios gives loan growth visibility. The bank is also speeding up its efforts to improve the retail liability franchise, which is a key positive. Retail deposits have gone up from 26% in FY2019 to 42% in 9MFY2023. Increasing share of retail deposits has been a key focus area for the bank, with 87% of incremental deposits over FY2020-9MFY2023 coming from retail deposits and CASA,” said the brokerage.
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