IIB IN

IndusInd Bank Ltd

Finance/Real Estate


Presented:03/13/2019
Price:₹1,636.25
Cap:$15.91B
Current Price:₹1,360.05
Cap:$17.09B

Presented

Date03/13/2019
Price₹1,636.25
Market Cap$15.91B
Ent Value$19.90B
P/E Ratio40.03x
Book Value₹397.22
Div Yield0.46%
Shares O/S602.65M
Ave Daily Vol133,465
Short IntN/A

Current

Price₹1,360.05
Market Cap$17.09B
IndusInd Bank Ltd. engages in the provision of banking services. It operates through the following segments: Treasury, Corporate and Wholesale Banking, Retail Banking, and Other Banking Operations. The Treasury segment refers to all investment portfolios, profit, loss on sale of investments; profit and loss on foreign exchange transactions, equities, income from derivatives and money market operations. The Corporate and Wholesale Banking segment includes lending to and deposits from corporate customers. The Retail Banking segment includes lending to and deposits from retail customers. The Other Banking Operations segment comprises all other operations not covered under other segment. The company was founded by Srichand P. Hinduja in January 31, 1994 and is headquartered in Mumbai, India.

Publicly traded companies mentioned herein: Bharat Financial Inclusion Ltd (BHAFIN IN), HDFC Bank Ltd (HDB; HDFCB IN), ICICI Bank Ltd (IBN; ICICIBC IN), IL&FS Investment Managers Ltd (ILFS IN), IndusInd Bank Ltd (IIB IN)

Highlights

The presenter sees an “interesting setup” for a long position in IndusInd Bank (IIB IN; “IIB”) at this time. With the stock at ~1,600 (INR), the risk/reward is favorable. At the same time as the bank is about to complete its acquisition of Bharat Financial Inclusion (BHAFIN), it will be done provisioning for its exposure to IL&FS. Prior to IL&FS, IIB was literally one of the top stocks anyone could have owned globally over the prior 10 years. If the presenter’s assessment of the setup is accurate and IIB can grow earnings 25% - 30% in a more normalized environment, then INR 100/share in FY 2020 (his estimate) can grow to 125 – 130/share in FY 2021, and there would be upside to at least an INR 2,250 – 2,340 range over the next 12 – 18 months (he believes the stock can trade at 18x expected forward earnings).

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Idea Discussion

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