IndusInd Bank Share Price Target: Emkay Cuts Target to Rs 650 Amid Q4 Loss, Management Shake-Up — Buy or Sell?

Emkay Global has sharply cut its target price for IndusInd Bank to Rs 650 from Rs 725, citing “heightened uncertainty” following a dismal Q4 performance and a wave of top-level resignations. The revised valuation, which implies a modest 0.9x FY27E adjusted book value, reflects growing investor concerns around “accounting lapses”, “asset quality stress”, and “leadership instability”.

In its latest report, Emkay maintained a ‘Reduce’ rating on the stock and slashed profit estimates for FY26–28 by 16–34%, flagging continued “business disruption” and the absence of executive leadership as key near-term risks.

“Though the capital (CET 1@15.1%) and liquidity (LCR @136%) situation is comfortable for now, factoring business disruption and management uncertainty, we trim our PAT estimates by 16-34% over FY26-28E and retain REDUCE with a cut in TP by 10% to Rs650 (from Rs725), implying 0.9x FY27E ABV. Key risk to our call: Appointment of a Marquee Private banker and a faster than expected business turnaround," stated Emkay in its report. 

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Leadership Exodus and weak performance 

IndusInd Bank reported a net loss of Rs 2,300 crore in Q4FY25 — one of the worst quarters in its history. The dismal performance came alongside the unexpected exits of its Managing Director & CEO, Deputy CEO, and Chief Financial Officer, triggering speculation over deeper issues within the bank's governance and internal controls, as per the observations by Emkay Global.

However, Emkay believes the Reserve Bank of India (RBI) could intervene by appointing a nominee director on the board, or even consider placing a public sector banking veteran at the helm, as seen in past crises at other private lenders.
“Even if a seasoned private sector leader takes over, rebuilding credibility and trust among investors and customers will be an uphill task,” the report noted.

Asset Quality Deteriorates

Fresh slippages stood at Rs 5,000 crore, largely driven by accelerated recognition of stress in the microfinance book and a real estate account slipping from the restructured pool. The gross NPA ratio rose to 3.1%, while net NPA came in at 1%, as per Emkay. The bank exhausted its Rs 1,350 crore in contingent provisions in Q4, reflecting the severity of asset quality pressures.
“The bank has fully consumed its contingent provision of Rs13.5bn in Q4. The management claims asset quality would improve from 2H, though we believe such recovery seems far off, as the risk of further cleanup by the new management is high,” Emkay states. 

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