Q4FY22 Preview: Axis Bank: NII seen at Rs91.1 billion, PAT at Rs36.9 billion

27 Apr 2022 , 07:24 AM

Result date: 28^th April, 2022
Recommendation: Buy
Target price: Rs940

Axis Bank is likely to report a healthy performance for the March 2022 quarter. The bank’s loan growth pegged at ~16% on a year-on-year
basis. Rising share of corporate loans and superior growth in unsecured loans could outline the quarterly performance. Consequently, net interest income (NII) could grow 21% over the year-ago quarter.

Despite marginal increase in operational expenses on a sequential basis, margins could remain unchanged at 3.5%.

Slippages are likely to moderate aiding the bank’s gross NPA ratio. Amid stable provisions, credit costs are expected to remain under check.

Profit After Tax (PAT) could grow 38% over the year-ago quarter, and will be aided by decline in provisions.

Important management insights to watch out for:
·         Credit demand across segments
·         Trends in restructuring, asset quality of BB & below rated loan accounts
·         Outlook on net interest margin
 

Rs Billion	March 2022 estimates	QoQ change	YoY change
Net Interest Income (NII)	91.1	5%	21%
Total Income	131.1	5%	18%
Pre-Provisioning Operating Profit	62.6	2%	9%
Profit After Tax (PAT)	36.9	2%	38%

Source: IIFL Research