Axis Bank shares fell over 5% in Friday’s session 739 up on the BSE, a day after the company reported a 54% jump in its standalone net profit for the March quarter. 4,118 crore on the strength of higher income and less provisions.
The bank’s gross non-performing assets (NPA) ratio, bad loans as a percentage of gross advances, stood at 2.82% in Q3FY22, down 35 bps sequentially. After provisions, the net NPA ratio stood at 0.73% in Q4, from 0.91% in the December quarter of FY22.
axis BankAccording to brokerage ICICI Securities, encouraging asset quality trends and NIM expansion will be the key to further drive the ROE. “Asset cost remains at 2.3% and with continued investments in growth and franchise build-up, management refrained from reiterating its earlier guidance of cost/asset ratio of 2.2% until the exit quarter of FY13. Maintain BUY with unchanged target price of 1,050,” the note said.
The difference between the lender’s net interest income (NII), interest earned and its payments increased by 17% to 17%. 8,819 crore for the quarter under review. Meanwhile, the net interest margin (NIM) for the quarter stood at 3.49%.
“Reducing aspects related to gross slippage, healthy recovery and upgrades and limited restructured book alternatively create a better asset quality picture,” Yes Securities said in a note. The brokerage has reiterated its buy rating on the shares of Axis Bank with a revised price. the goal of 1,050.
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