Keshav Seth 31 October 2026

IndusInd Bank Share Price Target at Rs 1,050: Emkay Global Financial Services

Emkay Global Financial Services has reiterated its BUY rating on IndusInd Bank, trimming its 12-month target price by 12.5% to Rs 1,050 from Rs 1,200, which implies about 25.7% upside from the current market price of Rs 835. The call follows a September-quarter net profit of Rs 1,242 crore that beat Emkay's estimate by 37%, helped by stronger other income, lower provisions and one-off treasury and foreign-exchange gains. Loans grew 11.4% from a year earlier after five weak quarters, gross NPAs eased and slippages moderated, but the net interest margin slipped 34 basis points. Emkay values the bank at 1.3 times September 2028 adjusted book value.

BUY · REITERATED
Q2FY27 Result Update
Private Bank
Target cut Rs 1,200 to Rs 1,050

IndusInd Bank's recovery climb gathers pace: Emkay sees 25.7% upside even after trimming its target

Emkay says the lender is on course for a 1% exit ROA in FY27, up from a 0.45% base in the March 2026 quarter. Margins dipped, and the long-term strategy is still evolving.

Climbing permit · No. Q2FY27/1050

Route: IndusInd Bank (IIB)

Expedition leader	Emkay Research
Call	BUY (retained)
Base camp (CMP)	Rs 835
Summit (12-mth TP)	Rs 1,050 1,200
Ascent	+25.7%
Permit valid to	September 2027
52-wk range	Rs 750 to Rs 1,078
Route basis	1.3x Sep-28E ABV

Base camp report: a 37% profit beat, with an asterisk

IndusInd Bank posted a September-quarter net profit of Rs 1,242 crore (ROA 0.9%), against a loss of Rs 437 crore a year earlier. Other income ran about 21% ahead of Emkay's estimate and provisions about 6% below it.

The asterisk: roughly Rs 100 crore was one-off, split between foreign-exchange sales from an earlier FCNR scheme (Rs 40-50 crore) and AFS/HTM investment sales (Rs 48-50 crore).

Altimeter readings · Q2FY27 (Rs crore)

Metric	Q2FY26	Q1FY27	Q2FY27	YoY	QoQ
Net interest income	4,409	4,685	4,570	+4%	-2%
Other income	1,651	1,787	2,248	+36%	+26%
Operating expenses	4,013	3,698	3,943	-2%	+7%
Pre-provision profit	2,047	2,774	2,875	+40%	+4%
Provisions	2,631	1,384	1,223	-54%	-12%
Net profit	-437	1,037	1,242	Turnaround	+20%
Emkay PAT estimate / consensus	Rs 908 crore / Rs 851 crore, so the actual beat both by 37% and 46%

The climb so far: ROA has doubled from the March-quarter base

Quarterly ROA plunged below zero in the March 2025 quarter, bumped along through FY26 and has climbed for three straight quarters. Management says it is on track for a 1% exit ROA in FY27 and aims, over the medium term, to regain its historical 1.75-1.80%.

Elevation profile · quarterly ROA (%)

Solid: reported ROA, Emkay Exhibit 12 (fiscal quarters). Dashed: management targets.

Who is pulling the rope? Management credits the roughly 80 bps ROA gain, matching the move from 0.1% in the December 2025 quarter, mostly to lower credit costs.

Rope team · contribution to the ~80 bps ROA gain

Credit costs 50-60 bps

Opex 15-20

Orange: income growth. Widths use range midpoints.

Loans move again after five flat quarters

Book growth: Net advances rose 11.4% year on year and 11.3% quarter on quarter to about Rs 3,63,100 crore. Retail grew 13% YoY and wholesale 10%.
Underlying pace: Excluding the FCNR(B) effect, retail grew 4% and consumer loans 7% sequentially, with vehicle loans expected to pick up in the second half.
Unsecured caution: Credit-card balances fell 3% and personal loans 2% QoQ as the bank chose quality over volume; both should grow again within a few quarters.
Distribution: 124 outlets added, 100+ branches planned in the second half.

Thinner air for margins, for now

Through the RBI swap window, IndusInd raised FCNR(B) deposits of about Rs 33,300 crore, which replaced costlier bulk funding. Deposits grew 10% YoY to about Rs 4,28,800 crore.

NIM

3.57% → 3.23%

-34 bps QoQ

CASA ratio

29.4% → 27.9%

Diluted by FCNR(B) inflows

CDs in deposits

5.9% → 3.3%

Full benefit yet to flow

Management expects to recoup the 2Q NIM decline over the next two quarters via higher-yielding growth and cheaper liabilities.

Firmer footing on asset quality

Gross NPAs fell 52 bps sequentially to 2.7% and net NPAs to 0.8%, with the slippage ratio at 1.6%. Microfinance net slippages dropped to 2.2% from 14.1% a year earlier, and about 89% of that book carries a CGFMU guarantee.

The one-time expected-credit-loss impact is about 1.1% of loans pre-tax, recurring at just 5-6 bps; provisions are in place.

The route to Rs 1,050: estimates, valuation and Emkay's trail

Emkay raised FY27E profit by 3.5% on the strong quarter but cut FY28-29E earnings by 3-5%, modelling ROA of 1.0-1.1% by FY28-29.

Rs crore / ratio	FY26	FY27E	FY28E	FY29E
Net profit	933	4,699	6,258	8,380
EPS (Rs)	12.0	60.3	80.3	107.5
Adj. book value per share (Rs)	675.0	731.6	793.4	880.0
ROA / ROE (%)	0.2 / 1.4	0.8 / 7.0	1.0 / 8.7	1.1 / 10.6
GNPA / credit cost (%)	3.4 / 2.3	2.7 / 1.5	2.3 / 1.1	1.7 / 1.0
P/E / P/ABV at Rs 835 (x)	69.7 / 1.2	13.8 / 1.1	10.4 / 1.1	7.8 / 0.9

Contour ruler · price to adjusted book (x)

Now ~1.1x

Target 1.3x

0.8x

1.6x

The stock trades near one standard deviation below its long-run mean, per Emkay.

Emkay's own trail on the stock has switchbacks: Reduce through 2025, Buy at Rs 1,100 from February 2026, Rs 1,200 in July and now Rs 1,050. The shares are down 17% in three months.

Avalanche bulletin: what could knock the climb off course

3 · CONSIDERABLESlower business growth (Emkay key risk)

Unsecured lending may recover slowly.

3 · CONSIDERABLEAsset-quality deterioration (Emkay key risk)

Higher slippages would undo the ROA gains.

2 · MODERATEDrought pockets in microfinance (earnings call)

Karnataka, Maharashtra and Andhra Pradesh, over one to two quarters.

2 · MODERATEFee and capital headwinds (earnings call)

Insurance-commission changes; a possible capital raise.

Editor's note

GNPA: Text says 2.7%; Exhibit 12 shows 2.8%. We use 2.7%.
Slippage ratio: Text says 1.6%; Exhibit 12 shows 1.8%.
Target arithmetic: Interpolated Sep-28E adjusted book of about Rs 837 times 1.3 gives about Rs 1,090, not Rs 1,050.
Growth guidance: Management guides system-level loan growth; Emkay models 22.7% for FY27E, partly FCNR(B)-funded.

Sources

Emkay Global Financial Services, IndusInd Bank Result Update, "Recovery gathers pace; on track for 1% exit ROA," October 25, 2026. Analysts: Avinash Singh, Nikhil Vaishnav, Aman Mehta. Figures converted to Rs crore by TopNews; the dollar figure at the report's Rs 94.9. The ROA chart re-plots Emkay's table; rope-team widths and danger grades are TopNews illustrations.

Disclaimer: This TopNews Story summarises a third-party research report for information only and is not investment advice. Investments in securities markets are subject to market risks. Read all related documents carefully and consult a registered financial adviser before investing.

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