IndusInd Bank Q1 net profit falls 68% to Rs 461 cr on higher provisioning

Private sector IndusInd Bank on Tuesday reported nearly 68 per cent fall in standalone net profit to Rs 460.64 crore for the first quarter ended June 30, due to jump in provisioning.

The bank had posted a net profit of Rs 1,432.50 crore in the same quarter previous fiscal.

The bank's standalone total income was up at Rs 8,680.92 crore in April-June quarter, compared to Rs 8,624.62 crore in the same period last year, IndusInd Bank said in a regulatory filing.

On the asset quality side, there was slight impairment with the gross non-performing assets (NPAs) or the bad loans as a proportion of gross loans at the end of June 2020 rose to 2.53 per cent from 2.15 per cent of the gross advances as on June 30, 2019.

In absolute terms, the gross NPAs spiked to Rs 5,098.95 crore from Rs 4,199.66 crore.

The net NPAs, however, showed improvement as it fell to 0.86 per cent of the net advances by the end of first quarter FY21, from 1.23 per cent a year ago. In value terms, NPAs stood at Rs 1,703.37 crore as against Rs 2,380.51 crore.

The bank's provisions for bad loans and contingencies for the reported quarter was raised by over five-times to Rs 2,258.88 crore as against Rs 430.62 crore in the year-ago period.

On consolidated basis, IndusInd Bank reported 64.4 per cent decline in its net profit at Rs 510.39 crore in Q1FY21, compared to Rs 1,432.54 crore in year-ago quarter.

Income moved rose to Rs 8,682.17 crore during the period, from Rs 8,624.62 crore.

IndusInd Bank -- promoted by Hinduja group -- has one subsidiary Bharat Financial Inclusion Ltd and one associate firm IndusInd Marketing and Financial Services Pvt Ltd.

The bank said the board of directors at the meeting held on July 28, 2020 has approved issuance and allotment of 4,76,29,768 equity shares on preferential basis at an issue price of Rs 524 per share to Route One Offshore Master Fund, Route One Fund I, ICICI Prudential Life Insurance Co Ltd, Tata Investment Corporation and AIA Company Ltd -- together called the QIB allottees or the qualified institutional buyers.

While 1,51,17,477 equity shares at the same issue price will be allotted to Hinduja Capital Ltd and IndusInd International Holdings (the Non-QIB allottees) on a preferential basis.

The allotment of preference shares is subject to approval of shareholders and other regulatory requirements, IndusInd Bank said.

The private sector lender said it will convene an extra-ordinary general meeting of shareholders on August 25 for seeking their approval for the preferential allotment of these shares.

IndusInd Bank scrip closed 4.05 per cent higher at Rs 526.90 apiece on BSE.