Axis Bank reported Q1 FY26 net profit of Rs 58.1 billion (down 4% YoY, in line) as lower opex and higher other income offset higher provisions. Net interest income was flat YoY at Rs 135.6 billion (down 2% QoQ, in line). Net interest margins declined by 17bp QoQ to 3.80% (in line).
NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
-
Indian Markets Turning Corner After Two Tough Years, Says Sandeep Tandon -
NDTV Profit Ignite 2026: Experts See Opportunity In Equities, Stay Bullish For Long-Term -
Buy Right, Sit Tight Does Not Work for Individual Stocks, Says Dinshaw Irani -
'Worst Is Behind': Quant MF Sees Market Bottom, Flags 'Extreme Euphoria' In Midcaps -
India's Mutual Fund Industry Could Become A $1 Trillion Opportunity, Say Fund Managers -
'Foreign Investors Are Baraatis': Raamdeo Agrawal's Take On LTCG Tax -
Stay Invested Through Market Cycles: Raamdeo Agrawal at NDTV Profit Ignite -
Ramesh Damani Remains Bullish On India For Next 20-30 Years, Sees Bargains Amid Market Weakness -
CAS Came After A Long Consultation Process: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFIT IGNITE -
Aim To Cut FPI Onboarding Time From Mth To Five Days: SEBI Chairman Tuhin Kanta Pandey AT NDTV PROFI
Motilal Oswal Report
Axis Bank Ltd. reported broadly in-line earnings in Q1 FY26 as lower opex and higher other income offset higher provisions. However, margins contracted sharply by 17bp QoQ due to repo rate cuts.
Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay
Asset quality deteriorated as slippages came in higher due to stringent classification of loans (technical impact), with gross non-performing asset/net non-performing asset ratios also increasing.
Advances growth was modest, while deposits declined 1% QoQ, leading to an increase in credit/deposit ratio to 91.2%. The bank has tweaked its classification of loan norms, which affected the slippages and credit cost.
Axis Bank intends to complete this exercise by Q2, which will keep near-term slippages and credit cost elevated. The residual loan re-pricing will also continue to put pressure on margins, though the bank has maintained its through-cycle margin guidance of ~3.8%.
We cut our earnings estimates for FY26/27 by 8.6%/5.7%, factoring in higher credit cost and margin pressure. We estimate FY27E RoA/RoE of 1.6%/14.6%. Retain Neutral with a target price of Rs 1,250 (1.6x FY27E adjusted book value + Rs 137 for subs).
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
