IndusInd Bank, ICICI Life, PSP Projects Q3 Results Review: HDFC Securities
IndusInd Bank reported its highest-ever quarterly earnings, largely on account of steady loan growth
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HDFC Securities Institutional Equities
IndusInd Bank Ltd. - IndusInd Bank reported its highest-ever quarterly earnings, largely on account of steady loan growth (up 19% YoY), stable margins, sustained traction in fee income and lower credit costs (1.7% annualised). Gross slippages at 2.3% witnessed some deterioration in the commercial vehicle/construction equipment portfolio and partial fallout from the restructured book, excluding of which the back-book appears to be incrementally stabilising. IndusInd Bank managed to garner retail deposits in the form of current account and term deposit from select affluent and NRI pockets, resulting in an overhang on its funding costs.
ICICI Prudential Life Insurance Company Ltd. - ICICI Life continued to print weak annual premium equivalent growth (three-year compound annual growth rate at -4% /-5% YoY, -4% versus estimates); however, value of new business margin shot up to 33.9% (+250 bps versus estimates), translating into 20% YoY VNB growth, led by a higher share of group protection, annuities and non-performing asset savings. The ICICI Bank Ltd. channel continued to disappoint; however, heavy investments in the agency channel are expected to offset the drag.
PSP Projects Ltd. - PSP Projects reported yet another weak quarter, with revenue/Ebitda/adjusted profit after tax of Rs 5/0.6/0.4 billion, thereby missing our estimates at all levels. PSP continues to disappoint with slower-than-expected execution ramp-up in Q3 FY23. Its entire order book (excluding Bhiwandi and Pandharpur forming 14%) is under execution. The current bid pipeline stands at Rs 45 billion, of which 70% orders are from Gujarat and 60% are private.
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