Axis Bank Q2 Review - Modest Operating Performance: Motilal Oswal
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Motilal Oswal Report
Axis Bank Ltd. delivered a weak operating performance in Q2 FY22 that was characterised by margin weakness (7 basis points QoQ decline) and a muted trend in core pre-provision operating profit.
However, lower provisions (Rs 17.3 billion) aided earnings which surpassed our estimate by 13%.
Business growth was tepid and was pulled down by a 5% QoQ decline in corporate advances, while a strong sequential recovery was witnessed in small and medium enterprise/retail loans.
On the asset quality front, fresh slippages remained elevated at Rs 54.6 billion although higher upgrades/recovery of Rs 47.6 billion aided an improvement in the gross non performing asset/net non performing asset ratio.
Axis Bank’s restructured book remained under control at 0.7% of loans.
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