BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
Axis Bank Ltd.’s credit cost at less than 60 basis points in Q4 FY22 leads to earnings beat. Sharp decline in stress pool (net non-performing asset plus restructured plus BB and below pool) to 2.33% (versus 2.9% QoQ) too is encouraging.
Non-NPA provisioning buffer of 1.77% against stress pool reassures moderating credit cost trajectory.
However, key to 16-18% return on equity trajectory will be net interest margin improvement (levers being asset mix change, deployment of excess liquidity, scale-up of low-cost deposits, and gradual decline in low-yielding Rural Infrastructure Development Fund investments).
Axis Bank's operating profit growth of 13% YoY / 5% QoQ missed expectations.
Net interest income growth at 17% YoY / 2% QoQ was a tad below expectations as NIMs declined 4 bps QoQ (to 3.49%) and advances growth remained at 15% YoY / 6% QoQ.
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