Why Has Antique Cut IndusInd Bank’s Target Price And Maintained Hold?
IndusInd Bank, a leading private sector lender in India, has built its reputation on retail lending, strong vehicle finance operations, and a diversified product mix. Over the years, it has expanded into corporate banking and digital banking initiatives, strengthening its customer base and brand presence. However, the bank is currently at a critical juncture. With a new CEO expected to outline the strategic direction in the coming months, investors are keenly watching its earnings trajectory, credit cost trends, and asset quality improvement. In this context, brokerage house Antique has revised its stance on the stock, cutting the target price and maintaining a Hold rating.
Target Price Cut And Rating Outlook
The brokerage has trimmed its target multiple to 0.9x September 2027 book value (from 1.05x earlier). The move signals a cautious approach as earnings normalisation is likely to take longer than previously anticipated. While the long-term fundamentals remain intact, near-term risks keep upside potential capped.
Muted Earnings Outlook For FY26
Antique projects that accelerated provisioning in FY26 will hurt profitability. The brokerage has reduced its FY26, FY27, and FY28 pre-provision operating profit (PPOP) estimates by 6–8%, while PAT estimates have been cut sharply by 53% for FY26, and by 12% each for FY27 and FY28. These downward revisions indicate a cautious stance on near-term earnings strength.
Loan Growth And Credit Trends
This subdued loan book expansion reflects cautious lending, higher provisioning, and a focus on asset quality restoration. With retail and vehicle financing as key drivers, the bank will likely adopt a measured approach until confidence improves. The muted loan growth forecast underscores the conservative stance taken by Antique in its projections.
Strategic Plan Under New Leadership
Investors are eagerly awaiting clarity on business priorities, digital expansion, and balance sheet strengthening measures under the new leadership. The success of this strategy will be pivotal in determining whether IndusInd can regain investor confidence and accelerate growth post-FY26.
Provisioning And Asset Quality Outlook
While provisions are likely to remain elevated in FY26, this front-loading of credit costs could provide a cleaner balance sheet going forward. The bank’s long-term performance hinges on its ability to contain slippages, maintain capital adequacy, and restore profitability momentum by FY27.
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Investor Takeaway
Antique’s Hold rating on IndusInd Bank reflects a cautious stance amid muted FY26 earnings expectations, elevated provisioning, and subdued loan growth. While the new CEO’s strategic plan could be a medium-term catalyst, the near-term outlook remains challenged. Investors should monitor loan growth revival and profitability trends in FY27 before reassessing exposure.
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SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
