Technically, IIB(CMP:927) has to sustain over 935-945 zone for an immediate to short term target of 965-985 and only consecutive closing above that it may target 1000-1020 & 1050-1085 in the mid to long term under bullish market scenario.
On the downside, inability to sustain over 935, IIB may immediately fall to 915-906-895-885 zone. Only consecutive closing below 885, it may further fall to 874-861-847 & sustain below that may further fall to 827-812-796-784 area in the worst bear case scenario.
Bottom Line: Technical Trading Levels (Positional)
| SL</>5 | FROM SLR | |||||||||
| Indusind Bk | CMP | 927 | ||||||||
| T1 | T2 | T3 | T4 | T5 | T6 | T7 | SLR | |||
| Strong > | 940 | 965* | 985 | 1000 | 1020 | 1035 | 1050 | 1085 | <935 | |
| Weak < | 935 | 915* | 906-895 | 885* | 874-861 | 847* | 827-812 | 796-784* | >940 | |
Q1 result of IIB published some days ago was above street estimates backed by strong loan growth (specially in CV & corporate loan book), other fee income (3-rd party product sell) amid stable NPA levels & NIM. But continuous brick & mortar branch expansions (aim to 1000 branch from around 880 branch as of now) may hurt some profitability. The bank is also emphasizing on increasingly digital platform to reduce the cost in the coming days.
Looking ahead, the bank is confident for a sustainable loan growth of 20% as it saw recovery in CV (specially Trucks for expected overall economic recovery) and retail/SME loan books (as it is high margin & law risk). Overall, the bank is trying to make 30% growth in revenue (Y-O-Y) including other fee based income.
But, the planned issue of additional securities to QIB (Rs.4327 cr last month) & to promoters (Rs.750 Cr) for additional capital rising may dilute net EPS to some extent. The scrip may have already discounted the good Q1 result, going by the time & price action over the last few trading sessions.
Thus, technically, IIB need to give consecutive closing above 935-945 zone for the target of 965-985, otherwise, it may correct up to 885 in the near term.
As par BG metrics, current median valuation of Indusind Bank may be around 785 & its projected fair valuations might be around 885-1000-1150 (FY:16-18) in the current market trends.
| SCRIP | EPS(TTM) | BV(Act) | P/E(AVG) | LONG TERM | SHORT TERM | MEDIAN VALUE | 200-DEMA | 10-DEMA |
| INDUSINDBK | 32.56 | 155.94 | 22.02 | 756.93 | 807.91 | 782.42 | 799.11 | 910.39 |
| INDUSINDBK | 41.5 | 229.25 | 22.02 | 854.55 | 912.11 | 883.33 | 799.11 | 910.39 |
| INDUSINDBK | 52.31 | 338.15 | 22.02 | 959.41 | 1024.03 | 991.72 | 799.11 | 910.39 |
| INDUSINDBK | 68.15 | 498.75 | 22.02 | 1095.08 | 1168.84 | 1131.96 | 799.11 | 910.39 |
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