After a long wait, IndusInd is going to get a new CEO. The bank has announced the appointment of veteran banker Rajiv Anand as MD and CEO. This will strengthen the leadership team of IndusInd Bank. The bank will now increase profits, cost and recovery and focus on ‘One IndusInd’ approach. The bank has a big challenge to increase its profit from its business. It will also have to increase its return on asset (ROA). The question is whether it is time to invest in the shares of IndusInd Bank or it will be right to take care right now?
Indusind Bank has faced difficult times since lapses in accounting. The bank’s top leadership team had to resign. In such a situation, appointment to the post of boss of a veteran banker from private sector is good news. Rajiv Anand was the deputy managing director in Axis Bank. He joined Axis Management in 2009 as Founding Managing Director and CEO. He was later appointed President of Retail Banking in Axis Bank. He was then included in the board of Axis Bank. He was made the head of wholesale banking.
The appointment of Rajiv Anand has ended the wait for the new CEO, but his work in IndusInd Bank will not be easy. Accounting lapses have affected every aspect of the bank’s business. In addition, the operating environment is compective and challenging. With this, it is not easy for IndusInd Bank to re -acquire your credibility. IndusInd Bank’s growth was poor in the first quarter of FY26. 4 per cent on a year-on-year basis and 3.3 per cent de-goth on quarterly quarterly basis.
IndusInd Bank is taking care in the case of MFI. Due to the increasing competition, it has reduced the pace of corporate banking. Weak loan growth is also taking care in the matter of increasing bank deposits, especially in view of sluggish growth in unseen high-free business. This has reduced the focus on bulk deposits with more cost. The share of retail deposits in the total deposit has increased, but the low-cost CASA (current and saving account) ratio has fallen to 31.5 per cent.
IndusInd Bank’s net interest margin (NIM) was 3.46 per cent in the first quarter of this financial year. This is less than the Fourth quarter adjusted NIM. Further reduction in repo rate, especially in June, is yet to affect. However, the bank’s fixed rate book (mostly retail) is close to 60 per cent and is relatively better. We hope to keep pressure on margins in short term. The core fees have come down to a low level of 1.1 per cent of the asset. It will take time to grow. The total slippeage of NPA remains high and 35 % of gross slippers comes from MFI. The bank is estimated to continue the pressure in some more quarter.
IndusInd ROA is expected to increase gradually. It fell to 0.45 per cent in the first quarter of FY26. Although the valuation of IndusInd Bank is not much, recovery will take time. So this stock is perfect for long -term investors who can be patient. The appointment of the bank’s new CEO can show positive impact on shares in the short term. On August 5, the bank’s stock opened with a good rise. However, later the boom decreased slightly. The share price was climbing 1.49 per cent to Rs 816 at 11 am.