IndusInd Bank Shares Drop 4% Amid Awaited PwC Report on Accounting Discrepancies

IndusInd Bank shares fell over 4% on March 28, ending a two-day rally, as investors awaited the findings of PricewaterhouseCoopers (PwC) regarding discrepancies in the bank's derivatives accounting. The report is expected by the end of this week.

Earlier this month, on March 10, the bank revealed discrepancies in its derivatives account balances, with a potential impact of 2.35% of its net worth. Following the disclosure, the stock plunged by 26%, reaching a 52-week low of ₹606 on March 12.

Management, RBI Address Investor Concerns

Ashok Hinduja, the bank’s promoter, attempted to ease fears by stating that these were "routine issues" and the bank was equipped to manage them. “Banking is based on integrity and trust,” he said, adding that shareholders should not panic.

The Reserve Bank of India (RBI) also issued a statement confirming that IndusInd Bank is well-capitalised and financially stable.

In response to the discrepancies, the bank has appointed Grant Thornton to carry out a forensic audit.

Sebi Investigates Insider Trading Allegations

Amid the controversy, reports suggest that the Securities and Exchange Board of India (Sebi) is examining whether any insider trading occurred during the period of market volatility and accounting uncertainty.

Brokerage Response and Market Outlook

Emkay Global recently removed IndusInd Bank from its model portfolio, citing ongoing uncertainty about the bank's leadership and the outcome of the derivatives issue. While current valuations may reflect much of the negative sentiment, the brokerage does not foresee an immediate recovery.

Despite recent gains from its 52-week low, IndusInd Bank continues to face market volatility, with investor sentiment closely tied to the upcoming audit findings and regulatory developments.

Read More: April Fools’ Day, Tariffs, and Tumult: What Happens After the Laughs?