IndusInd Bank shares buck the trend as markets crash; inflows worth $225 million likely

IndusInd Bank Ltd., one of the worst performers on the Nifty 50 index in 2024, is among the few gainers on the Nifty 50 index on Monday, January 13, after the lender released its December shareholding pattern.

As per the lender’s shareholding pattern, its foreign room (FR) has increased to 37%. When the lender had released its September shareholding, it had missed the MSCI full weight threshold of 25% by five basis points.

Based on the December shareholding, MSCI will increase its weightage on IndusInd Bank to 44 basis points from the current 22 basis points.

Analysts who CNBC-TV18 spoke to, are anticipating potential inflows worth $225 million on average, into shares of IndusInd Bank, during the upcoming MSCI review.
Nuvama Alternative and Quantitative Research wrote in its note that the shares of IndusInd Bank may see inflows between $250 million to $300 million due to this adjustment.

In case that happens, the rebalancing, along with the inflows, will be adjusted on February 28.

Last week, brokerage firm Goldman Sachs had downgraded IndusInd Bank’s shares to “neutral” from its earlier rating of “buy” and also cut its price target to ₹1,090 from over ₹1,300 earlier.

It said that while IndusInd’s revenue growth engines have slowed over the last two quarters, they are likely to be further impacted due to rising delinquencies in the commercial retail portfolio and slower loan growth.

Out of the 50 analysts that have coverage on IndusInd Bank, 36 of them have a “buy” rating, 12 of them say “hold”, and the other two have a “sell” rating.

Shares of IndusInd Bank are bucking the trend on Monday, trading 2.2% higher at ₹959.4. The stock has corrected 34% from the day the Nifty 50 index made a record high of September 27 last year.