IndusInd Bank share price target: Should you buy, hold or sell after earnings miss? Here’s what brokerages recommend

IndusInd Bank reported an 88.5% year on year drop in standalone net profit for the December quarter, with profit declining to Rs 161 crore from Rs 1,401 crore in the same quarter last year. The sharp decline was broadly in line with Street expectations of Rs 159 crore, aided by a sequential fall in provisions.

Despite the year on year drop, the lender managed to swing back into profit on a sequential basis, following a loss of Rs 445 crore in Q2FY26. Net interest income stood at Rs 4,562 crore, down 13% YoY but up 3% sequentially. Net interest margin came in at 3.52%, higher than 3.32% in Q2. On a consolidated basis, Q3FY26 profit stood at Rs 128 crore versus Rs 1,402 crore a year ago.

Following the results, brokerages including Bernstein, Motilal Oswal, Elara Capital and HDFC Securities offered mixed views on the stock. Here is how major brokerages have interpreted the results and what they recommend going forward:

Bernstein: ‘Outperform’ | Target price: Rs 1,000

Bernstein has maintained an Outperform rating on IndusInd Bank with a target price of Rs 1,000. The brokerage noted that weak performance persists with no clear signs of a turnaround. Loan growth remains muted, accompanied by balance sheet contraction.

It highlighted that retail stress remains elevated, especially in vehicle finance and microfinance segments. Slippages have stayed high on a sequential basis, and credit costs are expected to remain elevated. Bernstein also mentioned that the timeline for Return on Assets improvement has been pushed out and execution risk continues to be high, despite management’s constructive medium term outlook.

Motilal Oswal: ‘Neutral’ | Target price: Rs 930

Motilal Oswal has maintained a Neutral rating on IndusInd Bank while raising the target price to Rs 930 from Rs 850. The brokerage said that the bank’s earnings were broadly in line, and operating performance is expected to recover gradually.

However, provisions continued to stay elevated due to ongoing slippages in the microfinance institution segment. The firm noted that the bank expects its loan growth to align with industry levels by the end of FY27 and surpass industry averages in FY28.

Elara Capital: ‘Reduce’ | Target price: Rs 910

Elara Capital has revised its rating to Reduce from an earlier stance, but has raised the target price to Rs 910 from Rs 720. The brokerage stated that the bank is still undergoing a transition phase under new management and that challenges in asset quality remain due to elevated write offs.

Elara expects credit costs to remain high and has accordingly cut its FY27 earnings forecast by 9%. The target multiple has been raised to 1x on a roll forward basis.

HDFC Securities: ‘Reduce’ | Target price: Rs 720

HDFC Securities has retained a Reduce rating with a revised target price of Rs 720. The brokerage observed that IndusInd Bank delivered another muted quarter, affected by credit book de growth, high slippages in the MFI segment, and weak operating performance. Deposits declined 3% YoY and the CASA ratio dropped further to 30.2%.

HSIE said advances declined 13.5% YoY and 2.6% sequentially as the bank reduced exposure to calibrated MFI and wholesale banking segments. The brokerage cited multiple challenges, including a sub par deposit franchise, inadequate provisioning, and stress in the MFI book. It cut earnings forecasts for FY26, FY27 and FY28 by approximately 64%, 25% and 11%, respectively. RoA guidance of 1% appears to be a longer term target, according to the note.

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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)