Indian Bank (INDIANB) Q2 25/26 earnings summary

Executive summary

• Total business grew 12.34% year-over-year to INR 13.97 trillion, with deposits at ₹7.77 lakh Cr (up 12.09%) and advances at ₹6.20 lakh Cr (up 12.65%).

• Net profit for Q2FY26 was ₹3,018 Cr, up 11% year-over-year; H1FY26 net profit was ₹5,991 Cr, up 17%.

• Operating profit for Q2FY26 was ₹4,837 Cr, up 2% year-over-year; H1FY26 operating profit was ₹9,607 Cr, up 4%.

• Unaudited standalone and consolidated financial results for Q2 and H1 FY2025-26 were approved, with statutory auditors providing unmodified conclusions.

• Asset quality improved: gross NPA down to 2.60%, net NPA at 0.16%, and slippage ratio reduced to 0.79%.

Financial highlights

• Net interest income for Q2FY26 was ₹6,551 Cr, up 6% year-over-year; NIM maintained at 3.23%.

• Return on assets at 1.32% (standalone), return on equity at 19.58%.

• Cost-to-income ratio at 46.48% for Q2FY26; cost-to-income ratio increased by 70 basis points sequentially.

• Provision coverage ratio at 98.28%; credit cost at 0.26% in Q2.

• Capital adequacy ratio at 17.31% (standalone), CET1 at 14.80%, consolidated at 17.49%.

Outlook and guidance

• All previous guidance maintained except gross NPA, now targeted below 2%.

• Recovery guidance remains at INR 5,500-6,500 crore; INR 3,700 crore recovered so far.

• NIM expected to face mild pressure in Q3 due to MCLR and deposit repricing, but should stabilize and recover in Q4 if no further rate cuts.

• Management highlights continued focus on digital expansion, asset quality improvement, and capital adequacy.

• Digital business grew 59% YoY, with significant increases in digital loans and liabilities.