Axis Bank Share Price Falls Sharply As Analysts Cut Earnings Estimates Post Q3 Results
Axis Bank share price declined 5.37% to Rs 982.30 apiece, the lowest price since Nov 20, 2023.
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Axis Bank Ltd.'s share price hit the lowest level in over one year as analysts and brokerages cut earnings estimates. The near-term growth outlook looks bleak after a rise in slippages and rising credit cost weighed on the private lender's third-quarter performance.
During October–December, Axis Bank's overall slippages rose over 2.1% while credit cost rose over 85 basis points which surprised the Street negatively, according to Citi Research. Private lender's deposit and advance growth slowed below the brokerage's expectations. The brokerage cut earnings estimates by 3–4% for financial year 2025 and 2027.
Credit growth will slow down with sharper deceleration in MFI, personal loan, and cash credit and weak corporate credit demand.
Motilal Oswal Financial Services cut earning estimates by 4–5% for financial year 2026 and 2027. The brokerage estimates return on asset and return on equity to be at 1.6% and 14.1%, respectively, for next two financial year.
Axis Bank's near-term growth outlook, asset quality performance may remain under pressure due to stress in the macroeconomic environment, according to Motilal Oswal Financial Services. However, the brokerage expects limited downside risk from the current level.
Macquarie says cloud of uncertainty looms ahead for Axis Bank Ltd. Unsecured and agricultural delinquencies contributed to higher provisions. Low deposit growth restricts loan growth.
Axis Bank Q3 Earnings Highlights
Net profit rose 3.8% to Rs 6,304 crore vs Rs 6,071 crore (YoY)
NII rose 9% to Rs 13,606 crore vs Rs 12,532 crore (YoY)
Gross NPA at 1.46% vs 1.44% (QoQ)
Net NPA at 0.35% vs 0.34% (QoQ)
Axis Bank share price declined 5.37% to Rs 982.30 apiece. It was trading 5.27% down at Rs 983.30 apiece as of 9:58 a.m., as compared to 0.42% decline in the NSE Nifty 50 index.
The stock declined 8.72% in 12 months. Total traded volume so far in the day stood at 11 times its 30-day average. The relative strength index was at 25.19, which implied the stock is oversold.
Out of 49 analysts tracking the company, 40 maintain a 'buy' rating, nine recommend a 'hold,' according to Bloomberg data.
