Indian Bank shares rise after revealing fraudulent NPAs

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  • Stock Market News
Indian Bank shares rise after revealing fraudulent NPAs
Credit: © Reuters.

Shares of Indian Bank (NS: INBA ) have seen an impressive increase over the past year, with a 117.6% gain that significantly surpasses the Nifty 50 's 15% rise during the period.

On Monday, the bank's shares rose by 1.8% in early trading following the disclosure of fraudulent non-performing assets (NPAs) worth Rs 24.76 crore ($3.3 million) to the Reserve Bank of India (RBI). This case involves parties including Samsarapu Polaraju, Samsarapu Narasimha Raju, Maheswari Constructions & Engineering Works, and S V Exports.

The recent increase in share price comes just days after Indian Bank announced a strategic alliance with Tata Motors (NS: TAMO ) (NYSE: TTM ) subsidiaries on Thursday, October 13. The partnership aims to provide digital inventory financing solutions via Indian Bank's supply-chain finance platform.

Despite some challenges, such as poor earnings and cash flow that may force dividend cuts, as noted by InvestingPro Tips, the bank has raised its dividend for 3 consecutive years. This, combined with the anticipation of sales growth in the current year, suggests a promising outlook for the company.

InvestingPro data also highlights the bank's low earnings quality, with free cash flow trailing net income. However, the bank is trading at a low P/E ratio relative to near-term earnings growth, which may be an attractive factor for potential investors. For more in-depth real-time metrics, consider exploring the InvestingPro platform.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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