There is a stock in Nifty50 Index named IndusInd bank…
This stock has retraced from its all time high which was 2000+ to around 1000+.
This is a phenomenal fall of around 50%.
Given the fact that it is a Nifty50 stock what do you guys think?
My thought process is that in the next Index Rebalancing this stock might get excluded from Nifty50. Or is it a good time to start accumulating.
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I am a shareholder of Indus Ind bank. The 2000 level was somewhere around 2017 or 18. Since then It had touched a low due to corona at 300 (approx). For the last 8 months it was in the range of 1,300 (approx). It fell more than 20% from the previous day closure after the results were announced wherein they made a provision of 1,820 crores (total) and ended with a NP of 1,331 cr. This is a provision only and this is done to protect against any future contingency for its microfinance sector.
The same was done by equitas small finance bank but at a lower level, this too was done to protect any untoward events which might happen. But in the case of equitas, I was expecting a similar fall in price but the fall was negligible.
One of the factor for such a massive fall was due to, paris-headquartered Societe Generale offloaded 39.30 lakh shares or 0.50 per cent stake in the lender in a bulk deal at 1071.61.
This obviously would have an impact.
As a existing shareholder I am accumulating as not the entire provision will be used to write off and there will always be an write back of provision if things improve.
As of today, the market cap is still 82,849 cr. The capital adequacy ratio is 16.51 (capital adequacy ratio for banks set by RBI is 12%).
For putting things into perspective, there are 5 private banks who has higher market cap than indus ind bank with the highest being 1,309,306. There are many lower than Indus Ind Bank with the lowest being Dhanlaxmi bank at 868 cr.
These are my personal views.
I liked the title, the curious case of benjamin button (there was a movie by that name)
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What u mentioned above is public news. Provisions and all those bulk deals.
I’m interested in the price movement of this stock.
From Jan24 when Banknifty/FinNifty was trending i mean making Higher Highs and Lower Lows. This Stock was showing no sign of strength. Rather there was weakness.
I hope this stock does not change its number system from 4 digit to 3 digit.
This fear is coming from my previous experience with YESBANK.
so how do you think stock price moves? whatever the reasons stated above is the best explanation from a retailers side.
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The next YESBANK…Mayb Mayb not…
Banks like IndusInd, Bandhan, IDFC First and RBL Bank should be ignored regardless of valuations. There are much better quality Nifty 50 blue chips which are trading near 52 week lows for anyone interested in bottom fishing.
Hope ur exposure to this Bank is not too much…
Today i bought more.
I am a investor and this is a great opportunity for me.
1500 odd crores discrepancy will have an impact. But this will pass thru. P&l of this year will get hit for sure.
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Good luck, but market is often not dumb either. Its not as simple, everyone knows what you said.
Sometimes it will work, and sometimes, perhaps rarely, stock keeps going down in the long run because there is more than whats visible. Banks use leverage, so impact can be large if they seriously mess up. Hopefully not.
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If something is availablee cheap in markets, there will be one or the other problem. That’s the risk we will have to take by betting that the problem will solve in future. If everything is alright, it won;t be cheap and available at expensive valuation. Even if we buy expensive, there is no guarentee that things will always be same. Even then we are taking risk. If some problem arises in future in a good company, it too will crash.
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yes, so this kind of logic works better for the layman in index and diversified equity.
When you start doing that with individual stocks, imo we need expertise.
There is value and there is value trap. In my own very limited experience, smelly banks are to be left alone ( unless you know what you are doing). Averaging falling stocks can be dangerous for aam aadmi.
Anyway.
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Ofc you need to look at everything and take an educated bet. If you don;t know what you are doing, stick to index
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- CEO Sumant Kathpalia sold nearly all his shares at an average price of ₹1,437.
- Deputy CEO Arun Khurana has also dumped almost his entire stake at an average price of ₹1,451.
- FIIs who were holding 40.3% in March 2024, aggressively sold down to 24.7% by December 2024. And further selling this year…
- Promoters now barely hold 16%, while DIIs currently hold half of this company
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In the Year 2002 -2003 Indusind Bank price was around Rs.15 , while Yes Bank price was in the Year 2005 was around Rs.12 , will these these two banks now again match their price ? 
Probably both guys use TA and both the guys are good in charting 
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Those two insiders likely acted on Insider news. As such these kind of people dont follow charts, they make the charts 
Indeed. Knowing what it is that you “dont know” helps 
Often people think they know what they actually dont/cant know
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Yes may be , After all these guys having knowledge about the promoters, Hinduja brothers exiting the Bank or not showing any interest in Running the Indusind Bank
When i was analyzing stocks in Nifty Bank back in OCT-NOV24 i noticed some problem with the price of this IndusInd bank share. It was like a black sheep. The Price of the stock was not doing justice to the movement to the index or sector or the peers. It smelled fishy. I tried different forums highlighting the issue. The divergence in price could be trouble or an opportunity to accumulate. Turns out it was trouble.
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If they were using TA, then they would have sold yesterday or today and said some stupid pattern is formed. 
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