Axis Bank - Laying The Foundation For Sustainable Growth: Motilal Oswal

BQ Prime’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 BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.Axis Bank Ltd.’s annual report highlights the bank’s focus on strengthening its retail franchise and investing in its distribution network and technological capabilities. The bank has laid special emphasis on increasing the mix of retail deposits. In FY23, it reported 21% growth in current account and savings account deposits, surpassing its peers. This facilitated a 100 basis points improvement in the daily average CASA mix, reaching 44%. Axis Bank continues to invest in digital initiatives to ensure sustainable long-term growth. In FY23, the bank sourced 55% of personal loans digitally versus 22% in FY18. About 24% of credit cards were also issued through a fully digital end-to-end process. Also, Axis Bank’s market share in credit card has improved to 14.7%, strengthening its position as the fourth largest credit card issuer in the country. The concentration of top 20 advances/deposits improved 105 basis points/110 bp YoY to 8.1%/9.0% in FY23 (11.8% in FY21). The bank has shifted its deposit strategy to ‘CASA plus retail term deposits’ and has consciously pruned bulk deposits.Axis Bank has a strong management team and a well-articulated strategy aimed at delivering 18% sustainable return on equity. Asset quality has improved significantly and we estimate return on asset to recover further aided by steady loan growth and moderation in opex ratios. We thus estimate RoA/RoE to be ~1.8%/~15.9% by FY25 and we reiterate our 'Buy' rating with a target price of Rs 1,175 (1.8 times FY25E adjusted book value plus Rs 100 for subs)..Click on the attachment to read the full report:.ICICI Bank Gets IRDAI Nod To Raise Stake In ICICI Lombard General Insurance.DISCLAIMERThis report is authored by an external party. BQ Prime 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 BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Axis Bank - Laying The Foundation For Sustainable Growth: Motilal Oswal

FY23 consolidated return on equity improves to 18.8%.

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