Axis Bank Q4 Results Review: Dolat Capital Maintains 'Accumulate', Hikes Target Price

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Dolat Capital Report

Earnings benefit from structural improvement in net interest margin to ~3.8-3.9% and continued optimization in opex ratios. Moreover, Axis Bank Ltd.'s provision coverage ratio at 75% and contingent provision buffers at 60 bps should limit earnings volatility.

However, business growth has been muted in recent quarters and a high LDR at 89% is partly constraining growth in our view.

Valuation gap vs large private peers likely to persist owing to lower RoA, growth constraints, and slightly weaker liability profile.

Maintain ‘Accumulate’ rating, valuing the bank at 1.8x FY27E P/ABV against RoA/RoE of 1.8%/15%.

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