NEW DELHI, February 5: The battering of IndusInd Bank scrip continues despite announcement of impressive results by the bank for the nine-months period ended December 31, 1997. The scrip has received a drubbing on the Mumbai Stock Exchange since it listed on January 29. Even after five days since its debut on the BSE, the scrip is still languishing around Rs 38, a discount of 16 per cent to its issue price of Rs 45.The scrip opened at a premium to the offer price at Rs 49 on the listing day and touched a high of Rs 65 before slipping below the offer price to Rs 39.5. During the day, the volume touched a high of 1.05 crore shares (because of profit booking at the level of Rs 65). Since then, both volume and price have declined. For instance, on February 4, only 44,500 shares were traded at Rs 38.
Even a 62 per cent jump in net profit to Rs 76.62 crore for the nine-month period ended December 31, 1997 compared with Rs 47.24 crore for the six-month period of the last fiscal failed to infuse fresh buyinginterest at the IndusInd counter. In fact, the nine-month PAT (fiscal 1998) is already higher than the full year figure of Rs 73.32 crore (fiscal 1997). The bank has achieved a much higher growth in operating profit at Rs 184.26 crore (for the nine-month period) compared with Rs 124.95 crore for 1996-97. Net profit would have been higher but for a spurt in provisions.
Provision and contingencies have risen from just Rs 51 crore for fiscal 1997 to Rs 107.64 crore (nine-month figure) mainly because of hardening interest rates. Income also saw an impressive growth of 11 per cent at Rs 547.52 crore (nine-month figure) compared with Rs 491.67 crore for fiscal 1997. The annualised EPS works out to Rs 6.38 and the scrip is now being traded at a low P/E multiple of 5.95.
The bank offered 4 crore shares at a premium of Rs 35 to the public in December, 1997. However, the retail response to the issue was not very encouraging. Although the issue was oversubscribed, it was mainly due to bulk applications. Thesubscription figures show that 79,942 investors applied for less than or equal to 1,100 shares (which constitues 55 per cent of the total issue size) and 1216 investors applied for more than 1,100 shares (for 6.02 crore shares which are 150 per cent of the total issue size).
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
