Q1FY24 Preview: Axis Bank: NII seen at Rs. 119,482 million, PAT at Rs. 58,690 million

24 Jul 2023 , 05:36 PM

Result date: 26^th July, 2023

Recommendation: Buy 

Target price: Rs. 1,090

(Source: IIFL Research)

Full impact of the acquired business of Citibank will be reflected in Axis Bank’s performance for the June 2023 quarter. This means, sequential performance of Axis Bank will be weak on most parameters. That explains expectations of 58% decline in Profit After Tax (PAT) on a sequential basis, owing to high operating expectations towards integration of Citibank acquisition. 

The year-on-year numbers though are likely to tell the real story behind Axis Bank’s performance in the quarter. As compared to the year-ago quarter, Axis Bank could post 22% growth in its loan book.

The Bank’s Net Interest Margin (NIM) could come under pressure amid rising cost of deposits. Slippages though could remain stable and credit costs are likely to be under check.

Axis Bank’s PAT could grow 42.30% over the year-ago quarter.

Important management insights to watch out for:

• Updates on the Citibank integration
• Near-term growth trends across segments
• Outlook on NIM, asset quality

Rs. Million	June 2023 estimates	YoY change	QoQ change
NII	119,482	27.30%	1.76%
PPOP	86,785	47.43%	(4.50)%
Profit After Tax	58,690	42.30%	(58.40)%

Source: Brokerage Reports