Axis Bank Q2 Results: Net Profit Up 70%

Axis Bank saw provisions fall by 68% in Q2, while core income rose 31% year-on-year.

<div class="paragraphs"><p>An Axis Bank branch in Mumbai.&nbsp;(Photo: Vijay Sartape/ BQ Prime)</p></div>
An Axis Bank branch in Mumbai. (Photo: Vijay Sartape/ BQ Prime)

Private lender Axis Bank Ltd.'s second-quarter profit rose as core income increased while provisions fell.

Net profit rose 70% year-on-year to Rs 5,330 crore in the July-September quarter, according to its exchange filing. Analysts polled by Bloomberg estimated a net profit of Rs 4,445 crore for the quarter.

Net interest income, or core income, rose 31% from a year ago to Rs 10,360 crore. Other income rose marginally by 3.76% to Rs 3,941 crore in the second quarter.

Domestic net interest margin for Axis Bank improved to 4.08%, up 35 basis points quarter-on-quarter. Overall NIM improved 36 basis points sequentially to 3.96%.

Gross non-performing asset ratio fell by 26 basis points quarter-on-quarter to 2.5%. Net NPA ratio, too, fell to 0.51% as of Sept. 30, compared with 0.64% as of June 30.

Fresh slippages during the quarter stood at Rs 3,383 crore, down 8% quarter-on-quarter. Upgradation and recoveries during the quarter stood at Rs 2,826 crore, while write-offs were at Rs 1,700 crore.

Total provisions for the quarter fell 68% year-on-year to Rs 550 crore. While loan loss provisions stood at Rs 751 crore, the bank could write back provisions worth Rs 201 crore during the quarter.

Total advances rose 18% from a year ago to Rs 7.3 lakh crore. Retail loan book rose 22% from last year to Rs 4.23 lakh crore and accounted for 58% of the total book.

The share of secured loans was at 79% of the retail book, while home loans comprised 35% of the individual lending portfolio. Corporate loan book grew 7% year-on-year to Rs 2.29 lakh crore.

Total deposits rose 10% year-on-year to Rs 8.1 lakh crore. Current account savings account deposits rose 14% to Rs 3.74 lakh crore. As a share of total deposits, the CASA deposits stood at 46%, compared with 44% last year.

The bank is expecting to conclude its transaction to buy Citi's India consumer business by March 2023, Amitabh Chaudhry, managing director and chief executive officer at Axis Bank, told reporters after announcing the quarterly results.

"Citi's Indian consumer business is trending as per our expectations. There is no need for us at this time to review the pricing of the deal," Chaudhry said.

In March, Axis Bank had announced that it would buy Citi's retail business in India for Rs 12,325 crore.