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Q3FY23 Preview: Axis Bank: NII seen at Rs105.4 billion, PAT at Rs53.7 billion

23 Jan 2023 , 07:19 AM

Result date: 23rd January, 2023

Recommendation: Buy

Target price: Rs1,090

Axis Bank is likely to post healthy loan growth of 5% on a sequential basis, driven by focus segments. As compared to the year-ago quarter, loan book could grow 15-16%. Deposit growth is pegged at 10% over the year-ago quarter and 5% sequentially. Overall, Net Interest Income (NII) could grow 22% over the year-ago quarter and 2% sequentially.

Margins are likely to remain relatively stable sequentially at ~3.96%. Slippage ratio is estimated at <2.5% on an annualized basis.

Analysts at IIFL Capital Services expect the bank to post operating profit growth of 32% over the year-ago quarter.

Profit After Tax (PAT) growth would be sharper, owing to benign credit cost (~0.5% annualized).

Important management insights to watch out for:

  • Credit demand across segments
  • Asset quality outlook
  • Improvement in cost ratios

 

Rs Billion

December 2022 estimates

YoY change

QoQ change

Net Interest Income (NII)

105.4

22%

2%

Total Income

149.6

20%

5%

PPOP

81.0

32%

5%

Provisions

8.9

(33)%

62%

Profit After Tax 

53.7

48%

1%

Source: IIFL Research

Related Tags

  • Axis Bank
  • Axis Bank Q3
  • Axis Bank Q3 preview
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