01 — At a Glance
The 6th Largest Private Bank That Just Became Everyone’s Favourite Worry Stock
- 52-Week High / Low₹969 / ₹605
- Q3 FY26 Revenue₹11,373 Cr
- Q3 FY26 PAT₹128 Cr
- Q3 EPS₹1.64
- Annualised EPS (Q3×4)₹6.56
- Book Value₹833
- Price to Book1.10x
- Dividend Yield0.00%
- Debt / Equity6.70x
- Gross NPA %3.56%
Reality Check: IndusInd Bank closed Q3 FY26 with ₹11,373 crore revenue (-11.2% YoY), ₹128 crore PAT (-90.9% YoY), ROCE at 6.47%, and Gross NPA at 3.56%. The stock has lost 2% over 1 year and -7.77% over 3 years despite a 23% bounce in the last 6 months. Full-year FY25 EPS was negative ₹26.11 — meaning the bank burned through accumulated profit. Crisil Ratings placed the bank on “Negative Outlook” in August 2025 and declined to remove the watch negative notice. The 6th largest private sector bank is now a textbook case of “how not to manage microfinance and derivative accounting.”
02 — Introduction
Welcome to IndusInd: Where Every Quarter Comes With a Surprise Audit Finding
IndusInd Bank started in 1994 as a new-generation private bank with genuine ambitions. Back then, the story made sense: retail focus, pan-India branches, fintech partnerships, and growth that could outpace the economy. The bank served 40 million customers. It had a subsidiary called Bharat Financial Inclusion Limited (BFIL) that was India’s 2nd largest microfinance lender with 13 million customers. Life was good. Returns were decent. The future looked borrowed from a PowerPoint deck that actually worked.
Then, beginning in March 2025, the bank disclosed a discrepancy in the accounting of derivatives. The CFO and MD resigned. The bank admitted to “unsubstantiated balances” and “income recognition issues” in microfinance. Crisil placed the bank on Watch Negative. An internal audit department was asked to examine “concerns brought to attention during the finalisation of accounts.” The stock fell. Deposits started to flee. Questions multiplied faster than the NPAs.
Q3 FY26 results arrived in January 2026. The bank reported ₹128 crore profit — down 91% YoY — because the microfinance portfolio was imploding, provisioning had to be ratcheted up aggressively, write-offs ballooned to ₹2,612 crore, and the NIM compressed under the weight of deposit repricing and interest-income volatility. New MD Rajiv Anand started on August 25, 2025, and immediately announced the “P.A.C.E.” strategy: Protect, Accelerate, Customer-centricity, and Execution. Essentially: we broke it, now we fix it, and we’d appreciate your patience.
The stock, however, decided hope was attractive and bounced 23% in 6 months. Because apparently, markets prefer the narrative of “we’ve appointed a fixer” to the reality of “we haven’t fixed anything yet.” Let’s dive into the numbers and see if the fix is real or just another quarterly surprise waiting to happen.
Crisil Note (Aug 2025): Rating reaffirmed at AA+/Negative. Removed from “Watch Negative” when MD Rajiv Anand was appointed. Management has committed to “no further material impact from lapses in internal financial controls.” That’s a low bar, but it’s the bar they set.
03 — Business Model: Banking With a Conscience (And a Compliance Problem)
They Lend Money. Badly.
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