IndusInd Bank shares fall 5% despite 72% YoY Q1 profit surge. Why analysts remain bullish?

Shares of IndusInd Bank dropped over 5% on Thursday, even after the private lender reported a 72% year-on-year (YoY) surge in net profit to Rs 1,037 crore for the first quarter of the ongoing FY27, with brokerages raising target prices for the stock.

IndusInd Bank shares fell to Rs 1,015.10 apiece on NSE today, after the private lender on Wednesday released its earnings for the April-June quarter of the financial year 2027. Its net interest income (NII) remained flat at Rs 4,685 crore in Q1 FY27, as compared to Rs 4,640 crore in the same quarter of last year.

Net interest margin improved to 3.57% from 3.46% in the corresponding quarter of the previous year. Provisions and contingencies, excluding tax, fell to Rs 1,384 crore from Rs 1,760 crore a year earlier. This supported the rise in bottom-line profit.

IndusInd Bank’s asset quality improved in the June quarter. Gross non-performing assets stood at 3.25% of gross advances as of June 30, 2026, compared with 3.64% a year earlier and 3.43% as of March 2026. Net NPA ratio improved to 0.95%, compared with 1.12% a year earlier and 1% at the end of the March quarter.

Also read | IndusInd Bank Q1 Results: Profit soars 72% YoY to Rs 1,037 crore; NII flat

Nuvama on IndusInd Bank share price

Nuvama Institutional Equities maintained its ‘Buy’ call on the shares of IndusInd Bank but increased its target price to Rs 1,250 apiece. This implies nearly 17% upside potential from the stock’s previous closing price of Rs 1,069.30 apiece on NSE.

The brokerage said IndusInd’s credit growth trajectory has turned sequentially positive while better NII and lower opex led to a strong 37% beat on profit estimate. The private lender’s management expects asset quality to improve further led by falling stress in MFI and hence LLP, which coupled with better credit growth and opex should put the company firmly on path to 1% exit RoA in FY27, it added.

“We believe IIB under new management is on a firm path of a calibrated turnaround beginning FY27 and should deliver a steady uptick in RoA to 0.8–1.5% over FY27–29,” Nuvama said in its note.

Motilal Oswal on IndusInd Bank share price

Motilal Oswal also raised its target price for IndusInd Bank to Rs 1,125 apiece, implying 5% upside potential, while reiterating its ‘Neutral’ rating on the stock. It also raised its earnings estimates by 18-19% in FY27 and FY28, and project the bank’s RoA at 0.7% in FY27 and 1% in FY28.

IndusInd Bank reported a healthy quarter, supported by healthy operating performance and one-off income, the domestic brokerage said. It noted that the bank’s business momentum picked up sequentially, led by strong growth in the corporate segment, while retail book growth remains muted.

“Deposit growth was driven by higher retail deposits, taking the retail deposit share to 49.5% of total deposits. The reduction in slippages was broad-based; however, slippages in the VF and MFI segments inched up due to seasonality, leading to a partial miss on our provision estimates for 1Q. The bank expects loan growth to broadly track industry growth in FY27, with potential to outpace the industry in FY28,” Motilal Oswal said.

IndusInd Bank share price

IndusInd Bank shares gained around 6% in one week and 18% in one month. The stock has gained more than 20% in 2026 so far.

In the longer term, IndusInd Bank shares have jumped around 26% in one year, but fell nearly 24% in three years. In the longer term, the bank’s shares have delivered over 8% return in five years. The company has a market capitalisation of nearly Rs 69,490 crore.

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