Axis Bank's share price corrected over 6 percent on Wednesday after the private lender reported a surprising net loss of Rs 1,388 crore in the fourth quarter ended March 31. The bank had posted a net profit of Rs 1,505 crore in the corresponding period last year. A CNBC-TV18 poll had estimated a net profit of Rs 1580.1 crore.
Shares of Axis Bank quoted at Rs 433.15 apiece, down 4.90 percent on the NSE at 10.32 am. The stock opened at Rs 430.75 today and has touched the day's low at Rs 425.95 so far. It closed at Rs 455.45 on Tuesday.
During the March quarter, Axis Bank's net interest income rose 19.3 percent to Rs 6,808 crore as against Rs 5,706 crore, YoY. While, the asset quality improved as gross NPA as a percentage of gross advances declined to 4.86 percent from 5 percent, QoQ. Net NPA fell to 1.56 percent from 2.09 percent, QoQ.
Meanwhile, Axis Bank CEO Amitabh Chaudhry batted for the lifting of the coronavirus lockdown due to economic concerns. India is currently on an extended lockdown to contain the outbreak of the coronavirus with the current phase ending on May 3.
"The government needs to lift the lockdown entirely now or else the country will face severe implications," Chaudhry told CNBC-TV18 in an exclusive interview. India has had the strictest lockdown with no major fiscal support like other countries, said Chaudhry, adding that it will take 6-9 quarters for revival of the economy.
Brokerages continue to maintain a bullish stance on the Axis Bank stock. Jefferies in its report said that a strong deposit franchise and well-capitalized balance sheet can help the company return to growth in FY22. However, FY21 PAT (profit after tax) will be weak on higher credit costs and weaker topline, it added.
The brokerage maintained a 'buy' call on the stock with a price target at Rs 530 per share.
CLSA also maintained a 'buy' call on the stock with a higher target price of Rs 595 per share. It said, "The Bank reported decent operating performance as loans grew 15 percent YoY. Provision buffer will smoothen the earnings trajectory." The deal with Max Financial is extremely positive for the Bank, CLSA added.
First Published: Apr 29, 2020 11:04 AM IST
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