According to The Hindu BusinessLine, IndusInd Bank's MD & CEO Rajiv Anand outlined an ambitious three-year growth strategy during a recent interaction. The bank aims to grow assets and liabilities in line with the banking industry in FY27 and start gaining market share in FY28, with plans to dominate in focused areas by the third year. Anand emphasized that the intent is to rejuvenate growth not just for the current year but for the foreseeable future, following significant changes in the leadership team on both assurance and business sides.
As reported by The Hindu BusinessLine, the bank's current asset portfolio includes vehicle finance business of around ₹1 lakh crore, corporate loans book of ₹1.3 lakh crore, microfinance business of ₹20,000 crore, and other retail businesses of ₹50,000 crore. The bank sees significant opportunity to grow its SME loans and secured retail advances like gold loans and affordable housing. The micro loan segment is expected to form 7-8% of the loan book, with 38% currently covered under the credit guarantee scheme and plans to achieve full coverage next year.
According to The Hindu BusinessLine, credit cards remain a very large part of the portfolio and serve as a critical instrument for maintaining engagement with existing customers. The bank adds approximately 150,000 customers monthly, providing a substantial opportunity to engage with this customer base. While the bank intends to cautiously grow this segment due to elevated industry risk, it is pivoting from building business with new-to-bank customers to focusing on servicing existing customers. The bank has started using the credit guarantee scheme to manage micro loan cyclicality.
As reported by The Hindu BusinessLine, the bank is focused on building a granular, retail liability franchise with its brand and distribution of over 3,000 branches across the country. The intent is to reduce dependence on bulk deposits through improved product offerings, enhanced branch productivity, and increased salary accounts. The bank is also tapping start-ups and focusing on gaining stickier retail deposits to reduce cost of funds going forward. Management emphasized that building a granular liability franchise is absolutely critical for the bank's future growth strategy.
According to The Hindu BusinessLine, the bank is targeting to exit next fiscal with 1% return on assets (RoA) while focusing on improving return on assets. Management indicated that NIMs could be somewhat lower due to more granular asset businesses but expects to make up for it through lower cost to assets and lower credit cost. Regarding capital requirements, the bank doesn't need capital at this moment but anticipates requiring capital after 18-24 months when growth has returned. The bank operates as a board-run company where all strategic decisions impacting IndusInd Bank must be decided by the board.
