Indian Bank (INBK IN) – Q1FY27 Result Update – Profitability would help tide over ECL impact – BUY
Published on 14 Jul 2026
INDIANBK saw a decent quarter; while loan growth and NIM were healthy resulting in higher NII/NIM, core PAT saw a drag as ECL provision of INR 10bn was made during the quarter. Management suggested that one-time ECL impact could be INR30bn, with incremental provision likely to be 12bps on standard assets. The bank continues to focus more on profitability than growth; we are factoring a loan/deposit CAGR of 12.5%/11.0% over FY26-28E. INDIANBK is a good quality PSB due to its management quality and earnings consistency. We expect core PAT CAGR of ~20% over FY26-28E, core RoA of 0.9% (FY28E) and negligible NNPA of 0.13%. We assign multiple of 1.3x on Sep’28 ABV to arrive at a TP of INR 1,000 and give a ‘BUY’ rating.
