IndusInd Bank (INDUSINDBK) Q3 24/25 earnings summary

Executive summary

• Retail deposit growth was strong, but overall deposits declined due to a strategic reduction in wholesale funding; the loan book grew 12% YoY, with robust digital adoption and a diversified portfolio.

• Net profit for Q3 FY25 was INR 1,402 crores, down 39% YoY but up 5% QoQ; ROA and ROE were 1.03% and 8.5% respectively.

• Asset quality remained stable overall, with gross NPA at 2.25% and net NPA at 0.68%, though the microfinance segment saw elevated slippages.

• Digital initiatives, including the INDIE platform, scaled rapidly and contributed to growth in digital assets and customer engagement.

• Board approved unaudited standalone and consolidated results for Q3 and nine months ended December 31, 2024, reviewed by joint statutory auditors.

Financial highlights

• Loans grew 12% YoY to ₹3,66,889 crore; deposits up 11% YoY to ₹4,09,438 crore; net interest income was INR 5,228 crores with a net interest margin of 3.93%.

• Non-interest income grew 8% QoQ to INR 2,355 crores; core fee income at INR 2,123 crores.

• Operating profit was INR 3,601 crores, stable QoQ but down 11% YoY; cost-to-income ratio increased to 52.52%.

• Provisions and contingencies rose sharply, with consolidated Q3 FY25 provisions at Rs 174,363 lakhs, up from Rs 96,925 lakhs YoY.

• EPS (consolidated, basic) for Q3 FY25 at Rs 18.01, down from Rs 29.60 in Q3 FY24.

Outlook and guidance

• Management remains cautious on the microfinance segment, expecting elevated slippages for another quarter but anticipates stability from Q1 FY26.

• Focus on expanding digital banking, rural reach, and retail deposit growth, with continued investment in technology and digital platforms.

• No specific margin guidance provided; management will reassess after Q4 and as microfinance stabilizes.

• MFI book share targeted to reduce to 8%-10% of total loans, with diversification into broader rural banking.

• Bank implemented new RBI investment portfolio norms from April 1, 2024, resulting in a one-time net gain of Rs 165.26 crores credited to General Reserve.