IndusInd Bank Sees 6% Share Price Decline Following Disclosure of Accounting Irregularities

The Indusind bank share price target fell almost 6% during trading on Friday, after it was able

to identify fresh Indusind bank accounting issue in the course of an audit conducted internally

of the microfinance department.

Indusind bank share price fell 5.7 percent to reach the low of Rs735.95 in the BSE. The stock

started trading at its lowest of the day and recovered some losses as the day moved on. At 10.30

morning, Indusind bank stock price was at Rs755.80 which was down 3.1 percent.

Fresh Discrapencies

IndusInd Bank said its Internal Audit Department (IAD) has discovered that a sum of Rs674

crore was not correctly reported as interest over three quarters of FY 24-25 which was reversed

completely the 10th of January, 2025.

In addition, in the wake of the receipt of a whistleblower complaint the IAD was requested to by

the Audit Committee of the Board to examine transactions that were which were recorded within

"other assets" and "other liabilities".

Mounting Troubles

The latest discrepancies are a result of the accounting errors IndusInd Bank had reported in

March with regard to the derivative portfolio. It is estimated to be a negative impact of about

2.35 percent of its Net worth at the end of December 2024.

The bank commissioned the agency PwC to analyze the effects on the balance sheet of the bank

as well as the lapses that occurred at various levels, and recommend remedial actions.

Brokerages Downgrade Stock

After the release of the most recent round of discrepancies in the market, brokers CLSA as well

as Invested have both downgraded IndusInd Bank stock and also reduced target prices, according

to reports in the media.

CLSA has cut its rating on Indusind Bank stock price target to 'Hold from 'Outperform', and

reduced the price target to Rs780 from earlier Rs900. In addition, Investec pegged IndusInd

Bank's price target for shares at Rs650, compared to Rs700 previously while also lowering the

price to 'Sell', from Hold.