'Buy IndusInd Bank for target Rs 220'

In a chat with ET Now, Seshadri Bharathan, MD & CEO, KSEMA Fincon Ltd., talks about the outlook of IndusInd Bank.

Your target for IndusInd Bank is Rs 220. Why do you like this stock?

The bank has turned around last two years where they had said earlier turnaround time of around three years. So, management has taken control of the bank. They are focusing on branch-led deposit strategy where they plan to increase the branch network to 700 by FY13. They see their loan dispersal growth of around 30% CAGR over next three years. We are seeing that the net interest margin for the bank has improved to 3.18%. Also, the CASA deposit also is improving for the bank. They are targeting CASA deposit of around 28% next year. Overall, the bank is doing well and this is one of the best stock picks in the midcap banking space.