Axis Bank Q2 Results: Profit rises 10% YoY, beats estimates; NII up 19%
Axis Bank's asset quality improved further during the September quarter. The gross non-performing asset ratio fell to 1.73% as on September 30, from 1.96% a quarter ago. The net non-performing asset ratio stood at 0.36% lower than 0.41% a quarter ago.
Private sector lender Axis Bank on Wednesday, October 25, reported a 10% year-on-year (YoY) growth in its standalone net profit at Rs 5,863.56 crore for the quarter ended September, compared to Rs 5,330 crore in the same period a year ago. The net interest income or NII, the difference between interest earned and interest expended, grew by 18.87% YoY to Rs 12,315 crore.
Both the net profit and NII were above CNBC-TV18's poll of Rs 5,732.7 crore and Rs 11,957 crore, respectively.
Axis Bank's asset quality improved further during the quarter under review. The gross non-performing asset (GNPA) ratio fell to 1.73% as on September 30, from 1.96% a quarter ago. The net non-performing asset (NNPA) ratio stood at 0.36% lower than 0.41% a quarter ago.
The operating profit for the quarter under review rose 12% YoY to Rs 8,632 crore.
The capital adequacy ratio for the private sector lender stood at 93.9%, the highest in 20 quarters.
The net interest margin (NIM) improved to 4.11% from 3.96% YOY and 4.1% QOQ.
Provision and contingencies for Q2 stood at Rs 815 crore, while specific loan loss provisions came in at Rs 1,010 crore. The bank has not utilised any Covid-19 provisions during the quarter. The lender holds cumulative provisions (standard and additional other than NPA) of Rs 11,758 crore, as of September 2023.
The lender's total deposits rose 18% YoY, within which savings account deposits rose 16% YoY, current account deposits jumped 7% YoY and total term deposits increased 22% YoY.
The bank’s advances, on the other hand, rose 23% YoY to Rs 8.97 lakh crore, as of September 30. Domestic net loans jumped 26% YoY and retail loans witnessed a growth of 23% YoY.
“Axis Bank has surprised us on the NII front. They are continuously increasing their high yielding loan portfolio, which has helped them to buck the trend on the NII front, compared to the other banks. Even on asset quality, the QoQ slippage has come down, which has resulted into a lower credit cost in this quarter. So these are the two major reasons where they have delivered very good set of numbers which are above street estimate,” said Ashutosh Mishra of Ashika Stock Broking.
Ahead of its Q2 results, shares of Axis Bank were trading a percent lower at Rs 955.15 on the NSE. The stock is up 1.43% so far this year against flattish Nifty Bank during the same period.
First Published: Oct 25, 2023 4:11 PM IST
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