This article first appeared on GuruFocus .
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Revenue:Not explicitly mentioned in the transcript.
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Net Interest Income (NII):INR 4,685 crores, adjusted for a one-off interest recovery on IT refund of INR 284 crores.
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Net Interest Margin (NIM):Normalized at 3.35% versus 3.39% QoQ.
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Pre-Provisioning Operating Profit (PPOP):INR 2,773 crores, growing 8% YoY and 21% QoQ.
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Provisions:INR 1,384 crores, down 21% YoY and 7% QoQ.
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Profit After Tax (PAT):INR 1,037 crores, up from INR 594 crores in the previous quarter.
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Return on Assets (ROA):Improved to 0.63% from 0.45% QoQ.
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Gross Non-Performing Assets (GNPA):Improved to 3.25%.
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Net Non-Performing Assets (NNPA):Improved to 0.95%.
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Capital Adequacy Ratio (CET1):16.1%.
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Capital to Risk-weighted Assets Ratio (CRAR):17.15%.
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Advances Growth:Average advances grew 2% sequentially from Q4.
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Deposits Growth:Average deposits increased by 1% QoQ.
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Retail Deposits:Grew 4% QoQ, with the share of retail deposits at 49.5%.
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Liquidity Coverage Ratio (LCR):Improved to 127% from 118% QoQ.
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Vehicle Finance Book:INR 99,718 crores, growing 3% YoY.
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Microloan Book:INR 16,305 crores, declined 3% QoQ.
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Consumer Banking Assets:INR 31,617 crores, grew 2% QoQ.
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Home Loan Portfolio:Grew 38% YoY and 6% QoQ to INR 6,089 crores.
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Personal Loan Book:INR 9,930 crores, decreased 4% QoQ.
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Credit Card Loan Book:INR 9,418 crores, decreased 3% QoQ.
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Release Date: July 22, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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IndusInd Bank Ltd ( BOM:532187 ) reported a significant improvement in asset quality, with gross NPA and net NPA improving to 3.25% and 0.95%, respectively.
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The bank's profit after tax increased sharply to INR1,037 crores from INR594 crores in the previous quarter, reflecting improved profitability.
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The bank's capital adequacy remains strong with a CET1 ratio of 16.1% and CRAR of 17.15%, providing ample capacity to support future growth.
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IndusInd Bank Ltd ( BOM:532187 ) is leveraging AI to enhance customer engagement, credit decisioning, and risk management, with over 12,000 employees trained on AI.
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The bank's wholesale banking segment showed robust growth, with the average wholesale bank loan book growing 7% QoQ, marking an inflection point following portfolio optimization.
Negative Points
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The bank's net interest margin (NIM) decreased slightly to 3.35% from 3.39% QoQ, due to changes in portfolio mix towards wholesale banking and secured retail assets.
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Retail deposit growth was modest, with average deposits increasing by only 1% QoQ, indicating a need for further improvement in deposit mobilization.
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The personal loan and credit card loan books experienced a decline of 4% and 3% QoQ, respectively, reflecting a cautious approach towards unsecured lending.
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The vehicle finance segment faced seasonality challenges, with disbursements falling 4% YoY, particularly in the two-wheeler segment.
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Despite improvements, the bank's return on assets (ROA) remains relatively low at 0.63%, with a target to reach 1% in the near future.
Q & A Highlights
Q: How does the recent corporate growth compare to previous quarters, and what is the future outlook for the mix between retail, SME, and corporate growth? A: Rajiv Anand, CEO, explained that the growth in the corporate sector is due to the strength built over the last six to nine months. The bank will focus on transactions that offer reciprocal benefits like transaction banking and salary accounts. While there is ample opportunity for growth in the wholesale sector, the bank also aims to optimize growth across SME and retail sectors to meet ROA aspirations.
Q: What is the outlook for the cost of funds and deposits? Is there room for further improvement? A: Viral Damania, CFO, stated that there is still work to be done on improving both the quantity and quality of deposits. The aim is to close the cost of funds gap with peers, which is currently about 150 basis points. The bank is focusing on improving the deposit mix, not just repricing.
Q: What actions are being taken to accelerate growth in retail and SME segments, and when can we expect to see results? A: Rajiv Anand, CEO, noted that microfinance and commercial vehicles typically experience seasonal weakness in Q1. Disbursements in microfinance have been flat QoQ, and vehicle finance, excluding two-wheelers, is accelerating. Traditional retail asset businesses are beginning to gain traction, with disbursements up 18% QoQ. Growth in these segments is expected to pick up over the next three quarters.
Q: How does the bank plan to achieve its target ROA of 1% by Q4, given the current ROA of 0.63%? A: Viral Damania, CFO, explained that the improvement will come from lower credit costs and operating expenses. The strategy involves a 60-40 split between credit cost reduction and expense management. While NIMs may fluctuate, the focus remains on achieving the 1% ROA target.
Q: What is the strategy behind the INR10,000 crore equity capital raise resolution? A: Rajiv Anand, CEO, clarified that the resolution is merely an enabling one. The bank's capital position is strong, and there is no immediate need for a capital raise. The decision will be made based on future requirements.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
