IndusInd Bank Q3 Preview: PAT may see sharp erosion up to 99%, NII likely to decline to 18%

IndusInd Bank is expected to report a sharply weaker Q3FY26, with brokers noting a 78%-99% year-on-year decline in profit after tax (PAT), against the backdrop of subdued loan growth, margin pressure and higher credit costs. Net profit is in a wide range between Rs 13 crore and 313 crore, as per the estimates of four brokers.Net interest income (NII) could rise to 18% and fall between Rs 4,300 crore and Rs 4,441 crore, the estimates show.

Estimates from Nuvama Institutional Equities, PL Capital, Systematix and ElaraCapital were taken into account. The figures could show a sharper deterioration on a sequential basis.The win will be announced on Friday, January 23.

Here’s what brokers recommend:

1) PAT

— Nuvama: Rs 110 crore, down 92% YoY and down 125% QoQ

— PL Capital: 13 crore, down 99% YoY, down 103% QoQ
— Systematix: Rs 229 crore, down 84% YoY and down 151% QoQ
— ElaraCapital: Rs 313 crore, down 78% year-on-year

2) SO

— Nuvama: Rs 4,300, down 18% YoY and down 2.5% QoQ
— PL Capital: Rs 4,441 crore, down 15% YoY and 0.7% higher QoQ
— Systematix: Rs 4,403 crore, down 16% QoQ and down 0.2% QoQ
— ElaraCapital: Rs 4,354 crore, down 17% YoY and down 1.3% QoQ

3) PPoP

Operating profit before the provision is expected to remain under pressure. Elara Capital expects a PPoP of Rs 1,947 crore, down YoY and QoQ of 46% and 4% respectively. Meanwhile, PL Capital estimates Rs 2,118 crore, down 41% year-on-year and 4% sequentially.

4) Margins

— Nuvama: 3.25% in Q3 FY26, down 68 bps YoY and down 7 bps QoQ
— PL Capital: 3.60%, down 68 bps year-on-year and up 8 bps quarter-on-quarter

5) Loans and deposits

— Nuvama: Loans are at Rs 3,18,800 crore, down 13% YoY and down 2% QoQ, while deposits are at Rs 3,94,000 crore, down 4% YoY and up 1.1% QoQ.
— PL Capital: Rs 3,18,800 crore, down 13 year-on-year and down 2% quarter-on-quarter

6) Credit costs

PL Capital expects credit costs to rise 73 basis points year-on-year to 2.63%, while declining 58 basis points quarter-on-quarter.

7) Asset quality

Systematix has set provisions at Rs 1,722 crore, which could decline 1.2 year-on-year and 34% quarter-on-quarter.

Slippages are expected to gradually decline, reflecting lower MFI slippages. It is therefore expected that provisions will also decrease sequentially, according to an outlook. Additionally, fee revenues are broadly stable, but non-fee revenues are expected to be higher on a sequential basis, this brokerage said.

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