shares of axis Bank increased by more than 6% The company’s standalone net profit for the December quarter almost tripled to Rs 750 in Tuesday’s session on the BSE. 3,614 crore as against 1,116 crore in the year-ago period.
Bank’s core net interest income up 17% 8,653 crore on the back of 17% credit growth and marginal expansion in net interest margin (NIM) to 3.53%.
“Axis Bank delivered a strong operating performance with net profit of 224% YoY (a significant beat) aided by strong credit growth, higher margins and controlled provisions. Management sees continued progress in 4QFY22 as well,” highlighted brokerage Motilal Oswal. It has maintained its buy rating on the bank stock with a target price. 975 per share.
The bank’s gross non-performing assets (NPA) ratio improved to 3.17% in Q3. Net NPA ratio stood at 0.91% in Q3FY22 as against 1.08% in Q2.
The private lender’s overall provisions came down to 1,334 crore 3,757 crore in the year-ago period, and more 5,000 crore remained untouched in the additional provisions of COVID.
Emkay said in a note, “The stock has witnessed underperformance (down 17% in 3 months), mainly due to sub-par growth/margin performance versus peers, which we believe is driven by strong Q3 print and improved outlook. It should be reverse.”
It has retained a Buy rating on the Axis Bank stock with a target price of Rs. 1,020. According to Emkay, the possible acquisition of Citi’s retail/card portfolio and the appointment of an ED will be important events to monitor in the near future.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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