Like Bank of Baroda, though IndusInd Bank posted a decline in Q4FY19 net profit, the market has given it a big thumbs up after the Bank stated that it has taken steps to clean-up the balance sheet.
The Bank announced yesterday that it has classified Rs.3000 crore exposure to IL&FS group as NPA in Q4 and this is what impacted the earnings.
The Bank reversed the earlier contingency provisioning of Rs.530 crore and made fresh provisions of Rs.1273 crore in Q4. This is being perceived as good news as this conveys that it will begin FY20 on a fresh note, leaving and clearing all the mess in FY19 itself.
The Bank stated that post this, its exposure to the IL&FS holding company is 75% provided for.
The market has reacted positively to this news with the stock price touching an intraday high at Rs.1639.95, going up over 8%.