IndusInd Bank Q2 results: Net profit up 22% on NII growth, low provision

Yield on assets for the quarter stood at 9.69 per cent, compared to 8.65 per cent in the same quarter of the previous year

IndusInd Bank on Wednesday reported a 22 per cent year-on-year (YoY) growth in net profit at Rs 2,202 crore for the September quarter, compared to Rs 1,805.28 crore in the corresponding quarter of the last year, mainly on the back of a rise in net interest income (NII) and fall in provisions.

NII grew 18 per cent Y-o-Y to Rs 5,077 crore while other income was up 13.5 per cent at Rs 2,281.9 crore.  

Provisions for the September quarter stood at Rs 973.8 crore, falling 14.7 per cent from a year ago. Net interest margin (NIM) for the quarter was 4.29 per cent against 4.24 per cent. It was 4.29 per cent for the previous quarter.

“We have always said that our NIMs will be in a range of 4.2-4.3 per cent. We don't see the need to raise capital unless and until we have something in mind or our growth goes beyond 25 because our internal uphold are enough to take care of the growth,” Sumant Kathpalia, managing director (MD) and chief executive officer (CEO), IndusInd Bank said.

Yield on assets was 9.69 per cent for the quarter against 8.65 per cent for the corresponding quarter of the previous fiscal. Cost of fund was at 5.40 per cent against 4.41 per cent.

At the end of September 30, gross non-performing asset (NPA) ratio was 1.93 per cent. It improved marginally from 1.94 per cent in the previous quarter. Net NPA ratio was 0.57 per cent compared to 0.58 per cent in the previous quarter. The provision coverage ratio was 71 per cent at the end of September 30.

As of September 30, total deposits of the bank were Rs 3.6 trillion, up 12 per cent Y-o-Y. “We don’t need to increase the deposit rates right now. I believe that we are at the optimal rate right now,” Kathpalia said.

The current account savings account (CASA) deposits increased to Rs 1.41 trillion in the quarter and accounted for 39 per cent of the total deposits in the quarter.

Advances as of September 30, 2023, were Rs 3.15 trillion, an increase of 21 per cent over September 30, 2022.