IndusInd Bank shares jump to 52-week high after CEO’s reappointment

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Shares of IndusInd Bank surged more than 4% to hit a 52-week high of 1,250 apiece on the BSE in Friday’s early trading session after the bank announced the re-appointment of Sumant Kathpalia as managing director (MD) and chief executive officer (CEO) of the company.

“The Board of Directors of IndusInd Bank at its meeting held on September 15, 2022, approved the re-appointment of Sumant Kathpalia as the Managing Director & CEO of the Bank, for a further period of three years, with effect from March 24, 2023, up to March 23, 2026,” the private lender announced in an exchange filing on Thursday. The re-appointment is subject to the approval of the Reserve Bank of India (RBI) and the shareholders of the Bank.

Kathpalia is a career banker with years of rich experience in large multi-national banks such as Citibank, Bank of America and ABN AMRO prior to joining IndusInd Bank. At IndusInd Bank, he has been part of the core leadership team that joined the Bank 14 years ago and has been pivotal in turning the bank around.

Private sector lender IndusInd Bank reported a 61% year-on-year (y-o-y) rise in its June quarter net profit to 1,631 crore, on the back of lower provisions and higher net interest income.

Its total provisions stood at 1,251 crore in the three months to June, down 30% from the same period last year. The lender also reported a net interest income (NII) – difference between interest earned and expended – of 4,125 crore in Q1 FY23, up 16% y-o-y. Its net interest margin, a key measure of profitability, stood at 4.21%, up 15 basis points (bps) y-o-y and 1 bps sequentially.

The bank witnessed a slight deterioration in asset quality as compared to the March quarter. Its gross bad loans stood at 2.35% of its total advances, up 8 bps from 31 March. However, compared to the same period last year, IndusInd Bank’s gross bad loan ratio was down 53 bps.

IndusInd Bank shares are up more than 36% in 2022 (YTD) so far as compared to a flat rise in benchmark BSE Sensex.

 

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