IndusInd Bank Company analysis

Industry Overview : Banking industry is different from other industries. No other industries come into directly contact with general public. Banking is the business where the Raw material and Final product is Same. Money. The assets in banking is far different from other businesses. No other business is as important as banking in Economy. That is why they called equivalent of economy. Many times the health of economy is analyse from health of Banking. As Banking is come into contact with general public and Industrial customer, it is important for Govt also. No other businesses hold this level of importance.

As India is emerging economy, the healthy banking is more and more important for Indian economy.

Company Overview : Incorporated in 1994, IndusInd Bank is part of Hinduja Group. Today it is one of the fastest growing Bank in India in all major segment.
Just like other banks, IndusInd bank also offer services to retail and corporate customer. The Bank is also credited one of the First Bank to become part of RBIs RTGS (Real Time System) system.  Just like other banks,  also offer services like ATM, Net banking, mobile banking, phone banking. The Bank also provide international banking services and have offices in London and Dubai.

The Bank offer following products and services

  • Personal Banking – CurrentAccount,Saving account, Deposits, Loans as per the need of customers.
  • Cards – Debit Card, Credit Card, Gold Debit Card
  • Wealth Management – Portfolio Management, Investments, Insurance
  • Corporate Banking – Fund Based Facilities, Non Fund Based Facilities, Value Added Facilities, Supply Chain Management
  • International Banking – Correspondent Banking, SWIFT, Rupee Drawing Arrangement, Advisory Services, Facilities to Exporters, Trade Finance, RFC Account for Residents RGold Banking, Remittance Services, Suvarna Mudra

A decade after its incorporation, June 2004, the bank was merged with Ashok Leyland Finance, which was among the largest leasing finance and hire purchase companies in India. In 2015, the bank also acquire the Gem and jewellery finance business of Royal Bank of Scotland. both of the events were big and important for a bank which give IndusInd bank larger base of customer and reach of new type of business.
Enlisting the help of KPMG, IndusInd Bank has adopted an enterprise-wide risk management system, including global best practices in the area of Risk Management. The bank has entered into a strategic alliance with Religare Securities for offering a value–added 3–in–1 savings accounts–linked package to customers –– comprising a savings bank account, a depository account, and an Internet trading account.

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Financials and Ratios :  

 2010-112011-122012-132013-142014-152015-16
Loan Book26165.6535063.9544320.6155101.846878888419.3 4
RoE15.0917.7414.3016.2817.4913.20
ROA1.261.391.441.611.641.63
Efficiency (%)35.1530.30.36.33.2533.3237.15
EPS12.8816.8621.4026.4133.4239.26
Book Value82.0896.69141.86164.48193.66291.02
Dividend per Share22.2033.544.5
Tier 1 Capital (%)121114131115
CASA (%)
Net NPA To Loan Book0000.330.300

Future Prospects : As a Private sector bank, though NPA is not big issue but whole banking sector is in pain. Even though IndusInd Bank is holding corporate loan segment but the NPA is very Low. As the Bank hold high allocation to Telecommunications, power steel, it looks little bit risky. But as the efficiency a d Capitalization is adequate, the Risk is not for tomorrow.

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About Ashutosh Tilak

Tracking Indian Capital Market since 2010. Finance Student, On this blog I am writing about finance and Investing. You can contact me analystashu@gmail.com or @androidashu & @InsideFinanc on twitter