IndusInd Bank shares hit 52-week high in early trade; what lies ahead?

Shares of IndusInd Bank Ltd hit a fresh 52-week high amid flat trading in benchmark indices today. IndusInd Bank shares rose 0.78% to a high of Rs 1497.95 today against the previous close of Rs 1486.30 on BSE. The stock of the private sector lender has gained 21.50% this year and risen 30.23% in the last one year.

Total 9469 shares of the bank changed hands amounting to a turnover of Rs 1.41 crore on BSE. Market cap of the bank rose to Rs 1.15 lakh crore.

The banking stock has a one-year beta of 1.3, indicating very high volatility during the period.

In terms of technicals, the relative strength index (RSI) of IndusInd Bank stands at 60, signaling it's trading in neither in the overbought nor in the oversold zone. 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 990.25 on February 1, 2023.

The lender reported a 22 per cent year-on-year (YoY) rise in net profit at Rs 2202.16 crore in the September 2023 quarter. Profit in the September 2022 quarter came at Rs 1805.28 crore. Interest earned rose 29% to Rs 11,247 crore in the September quarter against Rs 8708.03 crore in the corresponding quarter of the last year. The Q2 earnings of the bank met estimates.

Pre-provisioning operating profit of IndusInd Bank climbed 10.28% to Rs 3908.73 crore in Q2 against Rs 3544.36 crore in the September 2022 quarter.

Brokerage Motilal Oswal has assigned a target price of Rs 1,700 for the private lender asserting that IndusInd Bank (IIB) reported an in-line September quarter performance.

The brokerage expects the lender to deliver a 23% earnings CAGR over FY24-26 and RoA/RoE of 2.0%/16.8% by FY25. It has reiterated BUY rating with a target price of Rs 1,700.

"Loan growth was healthy at 21% YoY to INR3.2t, with healthy traction in both Corporate and Consumer Finance books. Fresh slippages rose 7% QoQ to Rs 14.7 billion, driven by a sharp rise in slippages in the corporate book to Rs 2.1 billion from Rs 0.4 billion in 1QFY24. GNPA/NNPA ratios remained stable at 1.93%/0.57%. The restructured book declined 12 bps QoQ to 0.54%," said the brokerage.

Brokerage Morgan Stanley has raised its target price to Rs 1,725 from Rs 1,525 earlier. Morgan Stanley said the midcap private banks are likely to outperform the banking sector stocks.

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