Indusind Bank share prices have come down to attractive levels after a big fall. On March 13, this stock saw a rise in early trading. At 9:18 am, this stock was trading at Rs 693 with a gain of 1.27 percent. If you are thinking of investing in this stock, then there is a lot for you in the report of foreign brokerage firm CLSA. CLSA has expressed hope for better performance of this stock. But, it has reduced the price target from Rs 1,300 to Rs 900. This means that this stock can rise 31 percent from the current level.
Stability in stocks after the big fall on March 11
CLSA has said in its report on IndusInd Bank that the last few days have been difficult for the bank. First, RBI gave only one year extension to the bank's CEO Sumant Kathpalia. After that, news of lapse in the bank's derivative portfolio came. Due to this, the bank's net worth is expected to decrease by about Rs 1500 crore. As soon as this news came, panic was seen among the investors. They started worrying about a big fall in this stock. However, after falling 27 percent on March 11, this stock has not fallen further.
Volatility may persist in the next 2-3 quarters
Foreign brokerage firms have said that uncertainty may persist for the next 2-3 quarters regarding IndusInd Bank. The bank has asked an independent agency to investigate its derivative portfolio. Investors fear that the amount of lapses may increase. On the other hand, the picture is also not clear regarding the stability of the management. CLSA says that if an executive of a government bank is made the CEO of IndusInd Bank, it will affect the sentiment of investors. If the lenders who give loans to the promoters sell the pledged shares, it will also have a bad impact on the sentiment.
Indusind Bank's financial health is good
Despite this, CLSA believes that the financial health of IndusInd Bank is good. It has told about two positive things. First, recovery can be seen in the micro finance segment. Second, liquidity has increased in the banking system. On the other hand, RBI can reduce the interest rate further. Its positive effect can be seen on the margin of IndusInd Bank. Due to these reasons, other brokerage firms have also given positive reports about IndusInd Bank.
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Citi also advised to buy shares
Citi has recommended buying Indusind Bank shares. But, it has reduced the target price from Rs 1,378 to Rs 1,160. It has said that considering the recent news, the bank's earnings may fall by 25 percent in this financial year. However, Kathpalia has said that the bank will again become profitable after the March quarter. On March 12, the stock closed 4.4 percent down at Rs 684.7.
