IndusInd Bank shares rise after Sebi bars former CEO, four others for insider trading

Shares of IndusInd Bank rose over 1% in early trade on Thursday after capital markets regulator Securities and Exchange Board of India (Sebi) barred the company’s former CEO Sumant Kathpalia, and four other senior officials from accessing the securities markets for alleged insider trading. In the last five out of six sessions, the private lender’s share price has risen nearly 6%.

Early today, IndusInd Bank shares opened a tad lower at ₹803.05 after ending 2% lower at ₹804.75 on the BSE in the previous session. However, the banking stock soon pared losses and gained as much as 1.5% to ₹816.95 in the first hour of trade so far. The market capitalisation of the private lender climbed to
₹63,365 crore.

The capital markets regulator, in an interim order, restricted former IndusInd Bank CEO along with four other senior executives, from the securities market. The four others named in the Sebi order are former executive director and deputy CEO Arun Khurana, treasury operations head Sushant Sourav, GMG operations head Rohan Jathanna, and Anil Marco Rao, chief administrative officer of consumer banking oerations. "All the Noticees, viz. Noticee Nos. 1 to 5 are hereby restrained from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, until further orders," SEBI's interim order states.

The latest Sebi order follows a statement by Sebi Chairman Tuhin Kanta Pandey on May 22, 2025, in which he said the regulator was examining the matter to determine if there were any egregious violations by the bank.

Shares up 35% from 52-week low

IndusInd Bank shares touched their 52-week low of ₹605.40 on March 12, 2025, after brokerages UBS and BofA Securities downgraded the stock and lowered price targets after the Reserve Bank of India (RBI) granted only a one-year extension to its incumbent CEO Sumant Kathpalia, instead of the three-year term recommended by the board.

Reports of discrepancies in its forex derivatives portfolio and balance sheet disclosures further triggered a sell-off in the stocks. This was followed by an internal audit review, top-level resignations, and a forensics probe, which left investors jittery.

The Ashok Hinduja-backed bank, however, rebounded nearly 35% from its 52-week low as the lender’s swift action to address the derivatives portfolio issue boosted investor confidence. Adding to it, corrective internal measures and positive brokerage reports further lifted sentiments.

For the fourth quarter ended March 31, 2025, IndusInd Bank reported a consolidated net loss of ₹2,328.9 crore due to higher provisioning and lower income. The interest income declined 13% to ₹10,634 crore from ₹12,199 crore in the March quarter of FY'24.

For the full fiscal, IndusInd Bank posted a 71% fall in net profit to ₹2,576 crore as compared to ₹8,977 crore in the previous fiscal. Provisioning during FY25 nearly doubled to ₹7,136 crore, from ₹3,885 crore in FY24.

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