IndusInd Bank share rose in early trade today after the private sector lender said it has finalised a potential candidate to replace Romesh Sobti as the Managing Director and Chief Executive Officer of the bank. IndusInd share has been gaining for the last two days and risen 4.36% during the period. The large cap stock touched an intraday high of Rs 1,359.60, gaining 3.25% compared to the previous close of Rs 1,311.50. The stock was top gainer on Sensex. On Nifty, IndusInd share rose 3.03% to Rs 1,353.
However, the stock has lost 15.28% since the beginning of this year and gained 7.53% during the last one year. The private lender, did not disclose the name of potential successor for the top job in its statement on Thursday. The bank said it would present the names to the Reserve Bank of India (RBI) for the approval of the central bank and will reveal the name of the selected candidate.
Romesh Sobti, who joined the bank in February 2008, will retire in March 2020, when he turns 70. The RBI norms stipulate 70 as retirement age for managing directors at banks.
Prior to this assignment, Sobti was the Executive Vice President, Country Executive, India and Head, UAE and Sub-Continent, at ABN AMRO Bank NV IndusInd Bank share price has gained 14% from its 52-week low of Rs 1,192 hit on October 10, 2019 when the lender announced its Q2 earnings.
Subsequently, the share closed 6.15% or 80.55 points lower to Rs 1228.95 compared to the previous close of Rs 1309. On Nifty, the stock lost 6.04% or 80 points to Rs 1,299.55 that day.
The private lender reported earnings which came below expectations.
It reported a 50% rise in its September-quarter net profit from a year ago due to higher net interest and other income. Net profit for the second quarter stood at Rs 1,383.37 crore, up 50.33%, from Rs 920.25 crore a year ago. However, net profit fell 3.4% on a quarter-on-quarter basis.
According to estimates by eight Bloomberg analysts, the lender was expected to report a profit of Rs 1,416.10 crore. The bank logged a 32.05% rise in net interest income to Rs 2,909.54 crore in Q2 of current fiscal compared to Rs 2,203.28 crore in the same quarter last year. Other income rose 31.08% to Rs 1,726.66 crore.
Tax expenses fell 34.21% to Rs 478.86 crore on a quarter on quarter on basis. Provisions and contingencies climbed 25% to Rs 737.71 crore in Q2 from Rs 590.27 crore in the corresponding quarter of last fiscal. Asset quality deteriorated in the second quarter.
By Aseem Thapliyal