IndusInd Bank’s share price saw a big fall on Tuesday, dropping nearly 25% due to worries about its derivative losses. But on Wednesday, the stock bounced back 14% from the day’s low after the management gave clarity on the issue.
Why Did IndusInd Bank Shares Fall?
On March 11, IndusInd Bank’s stock crashed 25%, hitting a low of ₹720.50. The fall happened because:
- Derivative Losses: The bank reported a loss of ₹1,530 crore, which is 2.35% of its net worth.
- Weak Internal Controls: Experts said this problem showed the bank’s risk management was not strong.
- Panic Selling: Investors got scared and started selling, causing a bigger fall.
Why Did IndusInd Bank Shares Recover?
On March 12, the stock opened at ₹627.95, touched a low of ₹605, and then jumped to ₹694.75 – a 14% rise from the lowest point of the day.
The reasons for this recovery:
- Management’s Assurance: IndusInd Bank’s promoter Ashok Hinduja said the bank is financially strong and will get full support if extra capital is needed.
- Clarification on Losses: The bank explained that the losses are not as bad as people thought and can be managed.
- Buying Interest from Investors: After hearing the management’s statements, buyers came back, pushing the price up.
Current Market Status
As of 10:19 AM, IndusInd Bank’s stock is trading at ₹679, up 3.4% from yesterday’s close. While some uncertainty remains, the bank’s statements have helped regain investor confidence.