IndusInd Bank Shares Fall 25% As Lender Reports Rs 1,530 Crore Derivative Portfolio Mismatch – News18
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IndusInd Bank Ltd’s shares fell 10% on Tuesday following a report that the bank discovered discrepancies in its derivative portfolio
IndusInd Bank Share
IndusInd Bank Ltd’s shares fell 25% hitting a 52-week low of Rs 674.25 on Tuesday following a report that the bank discovered discrepancies in its derivative portfolio during an internal review. The detailed review revealed an estimated adverse impact of around 2.35% on the bank’s net worth as of December 2024, equating to a potential hit of Rs 1,530 crore. The bank’s net worth stood at Rs 65,102 crore at the end of December 2024.
IndusInd Bank’s net worth is projected to decrease by Rs 1,600 crore to Rs 2,000 crore. The Hinduja-promoted lender plans to absorb this loss in its fourth-quarter earnings or the first quarter of the upcoming fiscal year, company executives revealed on Monday. This follows the resolution of accounting discrepancies related to multi-year derivatives transactions.
In the previous session, the stock dropped 3.86% to close at Rs 900, hitting a 52-week low of Rs 886.40 on the BSE. A total of 4.49 lakh shares traded, amounting to a turnover of Rs 40.47 crore. The bank’s market capitalization fell to Rs 70,161 crore, with its shares trading below the 5-day, 10-day, 20-day, 30-day, 50-day, 100-day, and 200-day moving averages.
IndusInd Bank’s stock has declined 42.42% over the past year and is down 37.24% in the last six months.
Regarding the CEO’s tenure, Nuvama Institutional Equities noted that the board had applied for a three-year term, but the approval was for only one year. This move is viewed negatively, with Nuvama suggesting that the bank will likely use this one-year period to transition to a new CEO. This comes after the recent resignation of IndusInd Bank’s CFO just ahead of its Q3FY25 earnings.
On the discrepancies in its derivative portfolio, the bank stated it has engaged a respected external agency to independently review and validate the findings, though it did not disclose the nature of the discrepancies. The bank reassured that its profitability and capital adequacy remain strong enough to absorb the “one-time impact.”
