The shares of IndusInd Bank have seen a sharp drop of 27% on Tuesday, marking one of the steepest declines in recent times. The stock closed at Rs 656.80, recording a loss of 27.06%. This decline has shaken the market, and the bank now faces significant financial setbacks. Its market capitalization has plunged by approximately Rs 19,052 crore, leaving its current market cap at Rs 51,000 crore. A key factor contributing to this decline is the downgrade of IndusInd Bank’s stock by several brokerage firms. These downgrades have raised concerns […]
IndusInd Bank Shares Dive 27%: What Went Wrong?
The shares of IndusInd Bank have seen a sharp drop of 27% on Tuesday, marking one of the steepest declines in recent times. The stock closed at Rs 656.80, recording a loss of 27.06%. This decline has shaken the market, and the bank now faces significant financial setbacks. Its market capitalization has plunged by approximately Rs 19,052 crore, leaving its current market cap at Rs 51,000 crore.
A key factor contributing to this decline is the downgrade of IndusInd Bank’s stock by several brokerage firms. These downgrades have raised concerns among investors, contributing to the sell-off. As a result, the stock has underperformed compared to other stocks in the BSE Sensex, where it saw the largest drop among the 30 Sensex shares.
The primary reason behind this drastic fall is alleged fraudulent activity. Reports suggest that a fraud worth Rs 1,500 crore has been uncovered in the bank’s derivative accounts. This discovery has sent shockwaves through the market, prompting the bank to appoint an external agency to investigate the matter. The investigation will review the situation, and only after its conclusion will the bank decide on any further action.
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This situation bears a resemblance to the crisis faced by Yes Bank in 2019. Yes Bank’s stock, which once stood at Rs 393, plummeted to under Rs 10 due to a near-collapse of the bank. This incident led to a major financial crisis for the bank, similar to what IndusInd Bank is now facing.
The broader stock market also witnessed a mixed day. The BSE Sensex closed at 74,102.32, a slight decline of 12 points, while the Nifty index rose by 37 points to reach 22,497.90. Despite the overall market performance, IndusInd Bank’s stock was one of the top losers. Other stocks like Nuvama and Senco also featured in the list of biggest losers.
Apart from the turmoil in IndusInd Bank’s stock, the IT sector also faced a significant downturn. The Nifty IT index dropped by 1.47%, with major IT stocks experiencing losses. Infosys, one of the biggest names in the sector, saw its shares fall by 3.09%, dragging the sector further down.
The decline in IndusInd Bank’s stock highlights the vulnerability of financial institutions amid allegations of fraud. With the ongoing investigation, investors are on edge, awaiting clarity on the bank’s next steps. The outcome of the investigation will likely determine the bank’s recovery trajectory and investor confidence in the coming days.
