IndusInd management highlighted some of its medium-term targets and the synergies it looks to gain from the merger with Bharat Financial, as it looks to grow CASA by 3x by FY22 and double the number of customers and non-vehicle retail book by FY23E.

Despite the slowing economy, management remains confident on the healthy medium-term growth outlook, and with integration of the MFI business it expects strong growth in retail deposits as well. It has so far opened ~2.5 mn savings accounts for its 8 mn MFI customers, targeting to open the balance by Mar-20 and has also opened term deposits for 0.9 mn customers, though balances are low.

While system growth has slowed for the vehicle segment (led by CVs), the bank is seeing growth, led by market share gains and steady growth in non-CV vehicle business. Non-vehicle retail growth remains strong (25-30%), and it aims to double the book over the next three years while keeping unsecured at < 5% of loans

While management is cautious about further NIM expansion (10 bp increase), with healthy loan and fee growth, expect ROEs to improve to ~20% in FY21E.

Disclaimer: The above report is compiled from information available on public platforms. inChat team advises users to check with certified experts before taking any investment decisions.

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