IndusIndbank (NSE: INDUSINDBK) shares rose 5% today on the Indian stock exchange. The trigger seems to be that the Chief Risk Officer resigned on Friday. That's probably not a good sign concerning the perceived performance of that Chief Risk Officer That could also be a slightly unfair description of what happened. For the one executive is unlikely to be responsible for as much as 5% of the corporate valuation. Well, not on the downside that is.
Yes, the downside, if the shares rise as he goes then we'd have to assume that the influence of his having been in post was to the downside. The replacement leading to the lifting of that influence wich had been depressing the price. And yes, a risk officer at a bank could have that much influence in theory. If, say, loans were being bundled out the door on a political, not banking, basis.
Fortunately we don't in fact have to assume that this is the case. Rather, we've a coincidence here, rather than a cause. For coincident with the resignation we've also a recommendation from Jeffries that IndusIndbank is still a buy at current levels.
IndusIndbank share price from NSE
The other major Indian news was that the Adani Group is getting marked down again. This is still the overflow from the Hindenburg short selling report. The base claim of which is that the different listed companies are all indebted in order to finance cross holdings in each other. We have no view on whether that's in fact true or not, we merely note both the allegation and the insistence from Adani Group that it's not in fact so.
What is obvious is that the market more generally hasn't made up its mind. We see waves of sentiment passing through the Adani stocks over time. That they all seem to move in unison one this or that day - as that sentiment changes - tells us that it is something to do with the group, not the performance of the individual businesses. The big speculation there is partly, of course, as to whether the allegations are true but also well, if they're not then how long will it be before the market more generally believes they're not?
