IndusInd Bank shares fall – What does body language indicate?
THE BACKGROUND
On Tuesday 11th March 2025, Indusind Bank stock witnessed the sharpest fall since 2020 when they earlier announced discrepancies in how their financial instruments had been accounted in the books, leading to massive losses in their profit and loss statement. Here we analyse a much discussed interview of the CEO Sumant Kathpalia aired by CNBC TV. Observe carefully the body language of the CEO – what all do you see? I have put a link to the interview in the description so you can observe the same and then read the rest of this article. Try and match your accuracy in reading a leader’s nonverbal communication with me especially when the stakes are high for him.
As soon as the interview begins, we see the CEO showing caution. As in this picture, his eyes are closing when CNBC executive editor Latha Venkatesh is speaking about the resignation of the CFO days before the loss is announced by the bank. This is either a sign of blocking out the bad news that he knows she is going to start out with or just trying to collect his cool because he knows that the questions that will come are going to be difficult.
Now we see an asymmetric placement of his lips on the left side of his face. It can be easy to interpret this as contempt or scorn depending on whether there is a slight smile or flaring of nostrils (both are seen a bit later in the interview). Which is why we have to look at Kathpalia’s resting face or baseline behavior during some other situation in the past.
OBSERVE THE BASELINE
DISTANCING HIMSELF
As soon as Latha mentions how the CFO resigned 60 days prior to the bank announcing the news of the loss, the CEO immediately goes towards the bank and closes his eyes, clearly trying to distance from this situation – he does not wish to be here. You can also observe him cutting her off, probably trying to contain the damage she is causing with the accusation. His higher pitched voice indicates that he is under stress. The use of words like “I think” repeatedly by the lead person also give a signal about the low level of confidence.
While trying to open up a bit here by unclasping his hands, IndusInd CEO can be seen to have withdrawn towards the back. He is missing out words and correcting “verbal slippage” being careful to try and avoid the dreaded words “marked to market” which was the reason for the loss showing up.
SHOWING STRESS – GOOD OR BAD?
You can see the self comforting and blocking behaviour here as he moves his hand in front of his face. Is it possible to control anxiousness or the urge to feel better in such a situation of high stress? I would say not. Poker face or poker body is a myth. In fact, investors should be worried if they saw absolutely no stress on the CEO given the situation.
WATCH OUT FOR THIS ONE
The red flag is his behaviour here as he says “I think this quarter will also be a profit.” The photo above has the timeline – go back and watch and make note of what all you see. Kathpalia is going to the back, his thumbs indicate self soothing and he is literally squirming in his seat, like shifting his weight. Something one does when they are feeling uncomfortable. So if you put the verbal and non verbal communication together – it does not match up. The CEO is speaking about profit but his body language is hesitating in more than one way. Is that because he is trying to deceive or because he is hoping he is right? That is difficult to say going just by this much. But I would hold my horses. Going by the market reaction today of relief to the stock prices , clearly the market does not think the same way!
Again the same self assurance gesture is visible when he is declaring the adequacy ratio, this time his hands are holding tight in front of his torso, he is really on his guard although a bit more relaxed. (If you are observant, you will have noticed that the CEO is looking towards someone on his left who is indicating to him to keep his body language relaxed – you can see misplaced smiles and sudden shifts in his tension whenever his eye shifts to this person)
WHY THE SMILES
Here is more visible proof in case you couldn’t observe sudden shifts happening in IndusInd CEO’s body language due to the person prompting him. The sudden smile here is out of place. One might feel it is because Latha has been replaced by another gentler anchor, but that is not the case. The key to confirming this is to observe all instances where you see him relaxing himself at will.
The point here being, this relaxed body language should be taken with a pinch of salt – he is not showing this because there is no problem to worry about but rather because someone is prompting him to “appear” relaxed.
MOST CONFIDENT MOMENT
Here when Sumant Kathpalia is saying how he has his work charted out for him in terms of rebuilding the trust of the investors and depositers, you see him the most confidentt. He is leaning forward, eager to engage. And both of his thumbs are going upwards naturally as he talks (unlike before when his left thumb was disappearing at the slight hint of less confidence and both thumbs invisible from sight when he is not confident)
A PASSIONATE MOMENT
When towards the end of the interview the CEO is mentioning about other areas of strength, you see him actively engaging his hands to explain unlike the initial guarded stance. Compared to the earlier body language, this is more open and relaxed where hand gestures are being used actively as illustrators to explain the content. He is probably the most passionate about this piece of microfinance that the bank has worked upon.
CONCLUSION
IndusInd CEO is guarded when talking about the loss and the news of his treasury team. He is assuring of a no loss situation for the quarter. His instinctive answer to this question was not very confident. However on being asked to repeat that statement, he very confidently repeats the same. Either in his mind he sorted out how other pieces of the bank’s work will pull up the loss or else merely stating the same answer again and again made him appear more confident. At this point, if going just by this interview, I would believe it is the latter.
REFERENCES:
- https://www.youtube.com/watch?v=mfkHgcPd7vo
- https://www.youtube.com/watch?v=GhdSgXZ9qws
- https://economictimes.indiatimes.com/industry/banking/finance/banking/indusind-bank-shares-price-today-stock-crashes-25-networth-falls-derivatives-accounting-discrepancy-lower-circuit-banks-big-discrepency-explained-in-5ws-1h/articleshow/118874527.cms?from=mdr
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