Results     17-Jan-25
Analysis
Axis Bank
Business growth slows, margins ease
Axis Bank has reported 4% growth in net profit at Rs 6303.77 crore for the quarter ended December 2024 (Q3FY2025). The bank has posted healthy 9% growth in net interest income (NII), while the core fee income of the bank also improved 6% in Q3FY2025. The Net Interest Margin (NIM) of the bank eased to 3.93% in Q3FY2025 compared to 4.01% in the corresponding quarter of previous year.

On business front, the bank has witnessed moderation in the business volumes growth to 9% end December 2024 with deceleration in loan growth to 9%. The asset quality of the bank was stable in Q3FY2025, but the bank has witnessed rise in fresh slippages of loans. Bank has maintained steady credit to deposit ratio at 92.6% at end December 2024 from 92.7% at end December 2023. However, the CASA ratio of the bank has declined to 39.5% at end December 2024 from 42.1% at end December 2023.

Asset quality stable: The bank has maintained stable asset quality in Q3FY2025.

The fresh slippages of loans stood at Rs 5432 crore in Q3FY2025 compared with 4443 crore in previous quarter and Rs 3715 crore in the corresponding quarter last year.

The recoveries and upgradations of NPAs was at Rs 1915 crore and the write-off of loans was at Rs 3133 crore in Q3FY2025.

The standard restructured loan book of the bank (net of provisions) declined to Rs 874 crore end December 2024.

Provision coverage ratio declined to 93.00% at end December 2024 compared to 94.00% a quarter ago and 94.00% a year ago.

The capital adequacy ratio of the bank stood at 17.0% with Tier I ratio at 15.0% at end December 2024.

The risk weighted assets of the bank has increased 12% YoY to Rs 1113770 crore end December 2024,

Asset Quality Indicators: Axis Bank

 

Dec/24

Sep/24

Jun/24

Mar/24

Dec/23

Variation

QoQ

YTD

YoY

Gross NPA (Rs Crore)

15850.27

15466.23

16211.34

15127.12

15893.01

2

5

0

Net NPA (Rs Crore)

3774.79

3612.47

3552.98

3247.47

3526.87

4

16

7

% Gross NPA

1.46

1.44

1.54

1.43

1.58

2

3

-12

% Net NPA

0.35

0.34

0.34

0.31

0.36

1

4

-1

% PCR

93.00

94.00

94.00

94.00

94.00

-100

-100

-100

% CRAR - Basel III

17.01

16.61

16.65

16.63

14.88

40

38

213

% CRAR - Tier I - Basel III

15.01

14.12

14.06

13.74

12.43

89

127

258

Variation in basis points for figures given in percentages and in % for figures in Rs crore

 

Business Highlights:

Business growth ease: The business of the bank has increased 9% YoY to Rs 2110447 crore end December 2024 showing moderation from 13% growth end September 2024. The loan growth has eased to at Rs 1014564 crore. Deposits rose at slower pace of 9% to Rs 1095883 crore at end December 2024.

CASA deposits ratio declines: The CASA deposits of the bank rose 2% YoY to Rs 432855 crore at end December 2024. The current account deposits increased 8% to Rs 143611 crore, while saving account deposits were flat yoy at Rs 289244 crore end December 2024. The CASA ratio declined to 39.5% at end December 2024 compared to 42.1% at end December 2023, while also eased from 40.6% a quarter ago. The term deposits have increased 14% to Rs 663028 crore end December 2024.

Loan growth ease: Advances growth was driven by retail loans rising 11% YoY to Rs 605825 crore at end December 2024, while credit to MSME moved up 15% to Rs 114101 crore at end December 2024. The corporate credit rose 4% to Rs 265826 crore end December 2024. The overseas credit has declined 1% to Rs 28812 crore end December 2024.

Investment book of the bank increased 14% YoY to Rs 353283 crore at end December 2024.

Margins ease: The bank has showed 11 bps YoY jump in cost of deposits to 5.46%, while the cost of deposit declined only marginally by 1 bps on qoq basis in Q3FY2025. NIM has fell 8 bps YoY and 6 bps qoq to 3.93% in Q3FY2025.

Branch expansion: The bank has added 129 branches and reduced 252 ATMs in Q3FY2025, taking overall tally to 5706 branches and 14476 ATM`s end December 2024. The employee base of the bank has declined by 1050 to 102350 employees in Q3FY2025 in addition to reduction of 1100 employees in Q2FY2025. 

Book value of the bank stood at Rs 556.7 per share at end December 2024, while the adjusted book value (net of NNPA and 10% of restructured advances) was Rs 544.2 per share at end December 2024.

Quarterly Performance

NII rises at steady pace: Bank has recorded 11% increase in the interest earned at Rs 30953.94 crore, while interest expenses increased 12% to Rs 17348.09 crore in Q3FY2025. NII improved 9% to Rs 13605.85 crore in the quarter ended December 2024.

Moderate growth in the core fee income: Bank has posted 6% growth in core fee income to Rs 5455 crore, while the treasury income increased 26% to Rs 368 crore and other income 59% to Rs 149 crore, leading to 8% rise in the overall non-interest income to Rs 5972.20 crore in the quarter ended December 2024.

Expenses ratio improves: The operating expenses of the bank rose at slow pace of 1% to Rs 9044.20 crore, as other expenses declined 3% to Rs 6059.59 crore, while employee expenses increased 10% to Rs 2984.61 crore in Q3FY2025. Cost to income ratio improved 46.2% in Q3FY2025 compared with 49.5% in Q3FY2024, helping the Operating Profit to increase 15% to Rs 10533.85 crore.

Provisions and contingencies jump: The bank has showed 110% surge in provisions to Rs 2155.63 crore. The loan loss provisions zoomed 216% to Rs 2185 crore. However, the bank has written back standard asset provisions of Rs 28 crore and other provisions of Rs 1 crore.

Effective tax rate declined to 24.8% in Q3FY2025 from 25.2% in Q3FY2024. Net Profit rose by 4% YoY to Rs 6303.77 crore during quarter ended December 2024.

Financial Performance 9MFY2025:

Bank has posted 9% increase in net profit to Rs 19255.98 crore in the nine months ended December 2024 (9MFY2025). The net interest income increased 10% to Rs 40537.28 crore, while non-interest income moved up 18% to Rs 18477.54 crore, pushing up net total income by 12% to Rs 59014.82 crore in 9MFY2025. The operating expenses increased 7% to Rs 27662.26 crore, while provision and contingencies galloped 122% to Rs 6399.00 crore. Profit before tax rose 5% to Rs 24953.56 crore in 9MFY2025. The cost-to-income ratio improved to 46.9% in 9MFY2025 compared to 49.3% in 9MFY2024. An effective tax rate declined to 22.8% in 9MFY2025 compared to 25.2% in 9MFY2024. The net profit has increased 9% to Rs 19255.98 crore in 9MFY2025.

Axis Bank: Results

Particulars

2412 (3)

2312 (3)

Var %

2412 (9)

2312 (9)

Var %

2403 (12)

2303 (12)

Var %

Interest Earned

30953.94

27961.14

11

91434.53

80144.09

14

109368.63

85163.77

28

Interest Expended

17348.09

15428.99

12

50897.25

43338.61

17

59474.15

42218.02

41

Net Interest Income

13605.85

12532.15

9

40537.28

36805.48

10

49894.48

42945.75

16

Other Income

5972.20

5554.82

8

18477.54

15676.17

18

22441.96

16143.42

39

Net Total Income

19578.05

18086.97

8

59014.82

52481.65

12

72336.44

59089.17

22

Operating Expenses

9044.20

8945.73

1

27662.26

25894.19

7

35213.28

27040.86

30

Operating Profits

10533.85

9141.24

15

31352.56

26587.46

18

37123.16

32048.31

16

Provisions & Contingencies

2155.63

1028.34

110

6399.00

2877.78

122

4063.09

2652.64

53

PBT

8378.22

8112.90

3

24953.56

23709.68

5

33060.07

29395.67

12

EO

0.00

0.00

-

0.00

0.00

-

0.00

-12489.82

-

PBT after EO

8378.22

8112.90

3

24953.56

23709.68

5

33060.07

16905.85

96

Provision for tax

2074.45

2041.80

2

5697.58

5977.92

-5

8198.64

7326.17

12

PAT

6303.77

6071.10

4

19255.98

17731.76

9

24861.43

9579.68

160

EPS*(Rs)

81.5

78.5

 

124.4

76.4

 

77.99

74.92

 

Adj BV (Rs)

544.2

454.1

 

544.2

454.1

 

478.3

395.5

 

* Annualized on current equity of Rs 619.03 crore. Face Value: Rs 2, Figures in Rs crore

Source: Capitaline Corporate Database

 

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