IndusInd Bank shares surge on report that Axis Bank's Rajiv Anand likely strong candidate for CEO role

June 27, 2025 | Mumbai, India — IndusInd Bank shares rallied sharply in Thursday’s trade after reports surfaced that Axis Bank’s veteran banker Rajiv Anand has emerged as a leading contender for the Chief Executive Officer (CEO) position at the private sector lender. The news, though yet to be officially confirmed by either bank, ignited optimism among investors, pushing the stock up over 6% intraday on the National Stock Exchange (NSE).

Leadership Buzz Lifts Sentiment

According to reports from multiple financial dailies citing people familiar with the matter, Rajiv Anand, currently the Deputy Managing Director at Axis Bank, is under consideration by IndusInd Bank’s board as the next CEO. The move comes as the term of current CEO Sumant Kathpalia nears its scheduled end in March 2025, with regulatory limits on tenure in view.

“The board of IndusInd Bank is believed to be looking externally for a seasoned leader with a proven track record of navigating complex banking operations and strategic growth,” said one person close to the development.

Rajiv Anand brings with him over three decades of experience across financial services, with deep expertise in corporate banking, wealth management, and capital markets.

Market Reaction: Bullish Momentum

IndusInd Bank’s shares surged to a high of ₹1,740 during intraday trade on the NSE, gaining as much as 6.3% from the previous close. The stock closed at ₹1,720, up 5.2%, outperforming the benchmark Nifty 50 which rose 0.7% on the day.

Trading volumes were significantly higher than average, indicating heightened interest from institutional investors. Analysts attribute the rally to investor confidence in Anand’s leadership capabilities, should he assume the top job.

“Rajiv Anand has been instrumental in driving Axis Bank’s digital transformation and corporate banking strategy. His potential appointment at IndusInd Bank is being viewed as a strategic positive,” said Amit Khurana, Head of Equities at Dolat Capital.

Analysts See Positive Re-Rating Potential

Brokerage firms have started reassessing their outlook on IndusInd Bank in light of the leadership speculation. Several analysts noted that the bank could undergo a phase of positive re-rating if the appointment leads to renewed strategic focus, particularly on asset quality, digital banking, and retail growth.

“Leadership transition at this juncture is critical. Anand’s experience could address concerns around succession planning and bring in sharper focus on balance sheet quality,” said Priya Ranjan, Banking Analyst at Elara Securities.

Jefferies, in its note, maintained a ‘Buy’ rating on IndusInd Bank with a revised target price of ₹1,950, citing strong fundamentals and the potential upside from leadership clarity.

Strategic Challenges Ahead

While the markets cheered the potential change at the helm, analysts also cautioned that the new CEO would face a demanding operational environment. IndusInd Bank continues to face challenges in improving its CASA (Current Account Savings Account) ratio and building a stronger liability franchise.

“Despite robust earnings, IndusInd’s stock has lagged peers due to governance and succession concerns. A credible external appointment can help bridge the valuation gap,” said Ritesh Patel, Senior Analyst at HDFC Securities.

The bank has also been working to expand its retail loan book, reduce concentration risks in the vehicle finance segment, and enhance digital onboarding.

Regulatory Process in Focus

The CEO selection at IndusInd Bank is subject to approvals from the Reserve Bank of India (RBI), which has laid down stringent norms around tenures and eligibility criteria. Sumant Kathpalia’s term ends in March 2025, and the bank is expected to finalize a candidate well in advance for a smooth transition.

If Rajiv Anand is formally approached and accepts the position, he would need to step down from his current role at Axis Bank and undergo RBI’s fit-and-proper assessment process.

“RBI has been encouraging private sector banks to bring in leaders with strong compliance backgrounds and digital acumen. Anand fits that mould,” said an industry veteran on condition of anonymity.

Investor Outlook: Turning a Corner?

The recent development adds to IndusInd Bank's efforts to restore investor confidence after a period of subdued stock performance compared to peers like ICICI Bank and HDFC Bank. Over the past year, IndusInd Bank shares have returned 14%, trailing the Nifty Bank Index which has gained around 22%.

With improving asset quality metrics and stable net interest margins (NIMs), the bank has shown signs of recovery. The Q4 FY25 results posted in April showed a 16% YoY rise in net profit to ₹2,253 crore, driven by higher loan disbursements and better provisioning control.

“If the leadership change brings renewed energy into execution, IndusInd Bank could be entering a new growth cycle,” said Neha Shah, Portfolio Manager at Axis Securities PMS.

Eyes on the Confirmation

While there is no official confirmation yet, the mere speculation of Rajiv Anand taking over as IndusInd Bank's CEO has ignited investor hopes of stronger governance, renewed strategy, and improved market competitiveness. The coming weeks could be pivotal, not just for IndusInd Bank, but also for India’s private banking landscape.

If the appointment goes through, it could set the tone for a transformative chapter in the bank's journey.