HDFC Securities: Axis Bank’s Provision Buffers Strengthened Further
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HDFC Securities Report
Axis Bank Ltd. saw strong operating profit growth, led by robust net interest income growth, a sequential rebound in core fees, and controlled operating costs.
Even as we expect the bank to register a rise in gross non-performing assets in FY21E, it has already built significant provision buffers, which will limit the need for incremental provisioning.
Further, strength on the funding side (capital adequacy ratio and deposit traction) will allow the bank to capture resurgent credit growth.
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