Private lender Axis Bank is likely to post double-digit growth in its net interest income (NII) for the first quarter ended June 2024. The company will announce its results on July 24.
NII for the reporting quarter is seen rising 11% year-on-year, according to an average estimate of five brokerages. Net profit, meanwhile, for the same period may increase 12% year-on-year.
Net interest margins for the June quarter are expected to decline quarter-on-quarter by 6-8 basis points.
In the preceding March quarter, Axis Bank reported a standalone net profit of Rs 7,130 crore against a loss of Rs 5,728 crore a year ago. The net interest income rose 22% year-on-year to Rs 29,224 crore.
Here’s what analysts expect from Axis Bank’s Q1 results.
Kotak Equities
We are building loan growth of 15% year-on-year (2% quarter-on-quarter). We are building NIM to decline by 15 bps (3.7%) quarter-on-quarter led by higher cost of deposits and marginally lower lending yields. 1Q tends to be a seasonally weak quarter.
We expect slippages of Rs 4,500 crore (1.8% of loans) mostly led by retail and agriculture segments. Slippages tend to be higher in 1Q due to PSL. Key discussion areas: Slippages, especially from the unsecured segment, deposit mobilization and NIM progression.
YES Securities
Sequential loan growth will be in the 3.5% ballpark due to idiosyncratic growth trajectory. NII growth will be slightly slower than average loan growth due to rise in cost of deposits outpacing yield on advances. Consequently, NIM will be slightly lower sequentially.
Sequential fee income growth will broadly match loan growth. Opex growth will be higher than loan growth due to appraisal season. Slippages would be broadly stable on a sequential basis. Provisions will be stable on a sequential basis.
Sharekhan
Loan growth is expected to moderate to 15% year-on-year. Key monitorable would be deposit mobilisation, future progression of NIMs and discussion on equity capital raising.
Motilal Oswal
Expect the CD ratio to remain elevated. Cost ratios to remain elevated. Expect margin to moderate in 1Q. Asset quality ratios to be keenly monitored.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
