IndusInd Bank Share Price Rises 2% Post Q1 Results Despite Profit Dip

Market Performance

IndusInd Bank’s share price surged 2% intraday, reaching ₹819, after the company announced its Q1FY26 results. Despite weak financials, investor sentiment remained mildly positive, likely driven by certain core operational metrics.

So far in 2025, IndusInd Bank shares have slipped 17% year-to-date, reflecting broader concerns around earnings pressure and rising provisions.

Main News

In Q1FY26, IndusInd Bank reported a sharp decline in profit metrics:

• Standalone net profit stood at ₹684 crore, marking a 68% year-over-year decline.
• Consolidated net profit dropped 72% YoY to ₹604 crore.

The sharp fall was primarily attributed to lower loan disbursements and an increase in provisions for potentially bad loans.

Company Financial Highlights

Revenue

• Net Interest Income (NII) for Q1FY26 was ₹4,640 crore.
• This reflects a 14% decline YoY.

EBITDA / Operating Profit

• While EBITDA isn’t explicitly mentioned, operating performance was affected by weaker fee income and rising credit costs.

Net Profit

• Standalone net profit: ₹684 crore
• Consolidated net profit: ₹604 crore
• Both metrics reflect a steep YoY decline of 68–72%.

Margins & Profitability

• Core Net Interest Margin (NIM) stood at 3.35%, which was a marginal positive surprise in an otherwise weak quarter.
• Fee-to-assets ratio declined to 1.2%.
• Credit cost remained elevated at 2%.
• Slippages across the retail and vehicle finance segments pushed overall slippages to 3%.

Capital Adequacy

• Total Capital Adequacy Ratio under Basel III norms (excluding Q1 profits) was reported at 16.63% as of June 30, 2025.
• This compares to 17.04% as of June 30, 2024, indicating a marginal dip in capital buffer.

Loan & Deposit Trends

• Both loan and deposit figures fell 3% quarter-on-quarter, largely impacted by a decline in the wholesale banking segment.

Summary of the Article

Despite reporting a 68% fall in standalone net profit, IndusInd Bank’s share price rose 2%, supported by marginally positive metrics such as stable NIM and treasury gains. However, challenges persist in the form of elevated slippages, weaker fee income, and declining loan growth.

The bank's capital adequacy remains healthy, but rising provisions and subdued retail performance hint at lingering asset quality concerns. With stock performance down 17% YTD, the Q1 earnings may provide temporary relief, but long-term recovery hinges on improving core operations and credit discipline.