{"id":16325,"date":"2024-01-24T19:43:42","date_gmt":"2024-01-24T14:13:42","guid":{"rendered":"https:\/\/univest.in\/blogs\/?p=16325"},"modified":"2024-01-24T19:43:42","modified_gmt":"2024-01-24T14:13:42","slug":"axis-bank-q3-results-profit-rises","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/axis-bank-q3-results-profit-rises\/","title":{"rendered":"Axis Bank Q3 profit up 4%, misses estimates on weak margins"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/univest.in\/blogs-2\/axis-bank-q3-results-profit-rises\/#Axis_Bank_one_of_Indias_largest_private_sector_banks_has_reported_its_financial_results_for_the_October-December_quarter_The_banks_net_profit_for_the_quarter_stood_at_Rs_6071_crore_marking_a_4_YoY_rise\" title=\"Axis Bank, one of India&#8217;s largest private sector banks, has reported its financial results for the October-December quarter. The bank&#8217;s net profit for the quarter stood at Rs 6,071 crore, marking a 4% YoY rise.\">Axis Bank, one of India&#8217;s largest private sector banks, has reported its financial results for the October-December quarter. The bank&#8217;s net profit for the quarter stood at Rs 6,071 crore, marking a 4% YoY rise.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/univest.in\/blogs-2\/axis-bank-q3-results-profit-rises\/#What_are_the_thoughts_of_analysts_on_the_performance\" title=\"What are the thoughts of analysts on the performance?\">What are the thoughts of analysts on the performance?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/univest.in\/blogs-2\/axis-bank-q3-results-profit-rises\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h4><span class=\"ez-toc-section\" id=\"Axis_Bank_one_of_Indias_largest_private_sector_banks_has_reported_its_financial_results_for_the_October-December_quarter_The_banks_net_profit_for_the_quarter_stood_at_Rs_6071_crore_marking_a_4_YoY_rise\"><\/span>Axis Bank, one of India&#8217;s largest private sector banks, has reported its financial results for the October-December quarter. The bank&#8217;s net profit for the quarter stood at Rs 6,071 crore, marking a 4% YoY rise.<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><em>However, the figure fell short of market expectations, primarily due to provisioning linked to alternative investment funds (AIFs) and cost pressures.<\/em><\/p>\n<p>Despite the subdued profit growth, the bank&#8217;s net interest income (NII) grew by 9% to Rs 12,532 crore, driven by healthy credit growth. However, the net interest margin (NIM) shrank to 4.01% from 4.26% a year ago due to a rising cost of funds.<\/p>\n<p>Axis Bank&#8217;s loan growth remained strong at 23%, while deposits grew by 18%, pushing the credit-to-deposit (CD) ratio to an elevated 93%. This high ratio could potentially constrain future credit growth.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"What_are_the_thoughts_of_analysts_on_the_performance\"><\/span><strong>What are the thoughts of analysts on the performance?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Analysts have expressed mixed opinions on the bank&#8217;s performance. Jefferies and <a href=\"https:\/\/en.wikipedia.org\/wiki\/HSBC\" rel=\"nofollow noopener\" target=\"_blank\">HSBC<\/a> maintain a &#8216;buy&#8217; rating with target prices of Rs 1,380 and Rs 1,404, respectively, citing the bank&#8217;s strong franchise and attractive valuations. However, <a href=\"https:\/\/univest.in\/stocks\/motilalofs\/motilal-oswal-financial-services-ltd-share-price-today\">Motilal Oswal<\/a> downgraded the stock to &#8216;neutral&#8217; with a target price of Rs 1,175, expressing concerns about margin pressure and the high CD ratio.<\/p>\n<p>The bank&#8217;s management expects margin pressure to persist until Q1FY25 due to deposit repricing but anticipates an improvement going forward. Going ahead, Axis Bank&#8217;s ability to control costs and improve deposit mobilization will be crucial in driving future profitability. Managing the high CD ratio and maintaining loan growth will be a key challenge for the bank.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>Overall, while Axis Bank&#8217;s Q3 results were mixed, analysts believe that the bank is well-positioned for long-term growth. However, near-term profitability may face headwinds, and investors should keep an eye on the bank&#8217;s ability to address the near-term challenges and maintain its strong franchise value.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Axis Bank, one of India&#8217;s largest private sector banks, has reported its financial results for the October-December quarter. The bank&#8217;s net profit for the quarter stood at Rs 6,071 crore, marking a 4% YoY rise. However, the figure fell short of market expectations, primarily due to provisioning linked to alternative investment funds (AIFs) and cost<\/p>\n","protected":false},"author":15,"featured_media":26917,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[842],"tags":[],"class_list":["post-16325","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"metadata":{"_last_editor_used_jetpack":["classic-editor"],"_edit_lock":["1706105486:13"],"_edit_last":["13"],"rank_math_internal_links_processed":["1"],"rank_math_primary_category":["842"],"post_views_count":["864"],"_thumbnail_id":["26917"],"rank_math_seo_score":["79"],"rank_math_focus_keyword":["Axis Bank"],"rank_math_title":["Axis Bank Q3 results: Profit rises 4% to Rs 6,071 Crore"],"rank_math_description":["Axis Bank's net profit for the quarter stood at Rs 6,071 crore, marking a 4% YoY rise. 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