Shares of IndusInd Bank gained 2% to Rs 853 on the BSE on Monday after the private lender posted a net profit of Rs 1,176 crore in the second quarter of FY27, as against a net loss of Rs 445 crore in the same period last year, although Jefferies cut the target price following the earnings print.

IndusInd Bank released its results for the July-September quarter of the ongoing financial year 2027 on Friday. Its net interest income meanwhile increased 4% year-on-year (YoY) to Rs 4,569 crore during the quarter under review.

Also read | IndusInd Bank Q2 Results: Lender posts profit of Rs 1,176 crore vs Rs 445 crore loss a year ago

The private lender’s asset quality improved during the quarter, with gross non-performing assets (GNPA) declining to 2.73% of gross advances from 3.25% in the June quarter and 3.6% a year earlier. Net NPA declined to 0.83% from 0.95% in the preceding quarter and 1.04% in the corresponding period last year. The provision coverage ratio stood at 70.19% at the end of September, compared with 71.81% a year earlier.

Provisions and contingencies, excluding tax, declined 54% to Rs 1,223 crore from Rs 2,631 crore in the year-ago quarter. Fee and other income jumped 36% YoY to Rs 2,248 crore from Rs 1,651 crore, while net revenue increased 12.5% to Rs 6,817 crore from Rs 6,060 crore.

Why did Jefferies cut target price for IndusInd Bank?

Jefferies said IndusInd Bank’s profit, following a loss last year was ahead of estimates, supported by lower credit cost & better fee and treasury income. Loans grew by 11% YoY, NII by 4%, and asset quality continues to improve. The international brokerage sees levers to improve profitability through better PPoP, even as credit costs are near the bottom.

However, Jefferies lowered its earnings estimates for IndusInd Bank to factor in tighter banca fee rules and slightly higher credit costs, which led it to reduce the target price to Rs 1,130 from Rs 1,250 apiece. The latest target price implies an upside potential of more than 35% from the stock’s previous closing price of Rs 835 apiece on NSE.

Jefferies maintained its ‘Buy’ call on IndusInd Bank’s shares, and noted that the stock’s valuations are attractive at the current levels.

The domestic brokerage noted that the company’s net profit beat its estimates, driven by healthy NII growth and high other income. It said IndusInd reported a healthy quarter, supported by steady NII growth and high other income. Consequently, RoA improved to 0.87% from 0.63% adjusted for one-off in Q1 FY27, with the bank maintaining the target of an exit RoA of 1% by the end of FY27.

Also read | Double-digit growth seen on corporate scoreboard in Q2, but bank, IT, pharma lag

IndusInd Bank shares have fallen over 3% in one week and 8% in a month, with the stock overall being down more than 6% in 2026 so far.

While IndusInd Bank shares have gained 11% in a year, the stock has delivered negative returns of 41% in three years and 28% in five years. The company has a market capitalisation of nearly Rs 65,059 crore.

Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.