Axis Bank Reports 23% YoY Surge in Q1 Net Profit to Rs 7,114 Crore, with NII Rising 8%.
Axis Bank has reported robust financial performance for the April-June quarter of FY27, with a standalone net profit of Rs 7,114 crore, reflecting a significant year-on-year increase of 22.5% compared to Rs 5,806 crore in the same quarter last year. This performance is bolstered by a net interest income (NII) rise of more than 8%, reaching Rs 14,646 crore, surpassing analysts’ expectations from major financial institutions. The net interest margin has stabilized at 3.46%, indicating effective interest earning strategies amidst competitive market conditions.
On the asset quality front, Axis Bank has demonstrated improvements with a 4% decline in gross non-performing assets (GNPA) to Rs 17,124 crore, while net NPA increased by 2.5% to Rs 5,193 crore. Consequently, gross and net NPA ratios improved on a year-on-year basis to 1.28% and 0.39%, respectively. However, a slight sequential increase indicates challenges that may arise in the evolving economic landscape. The bank’s proactive approach to asset provisioning is evident, with significant one-time provisions maintained to bolster its balance sheet amidst macroeconomic uncertainties.
The lender’s balance sheet showcases impressive growth, expanding by 20% year-on-year to Rs 19.21 lakh crore. Total deposits rose 3% quarter-on-quarter and 18% year-on-year, highlighting strong customer confidence. The increase in current account savings account (CASA) deposits by 11% signifies a strategic capture of low-cost deposits, which is crucial for sustaining profitability. Additionally, advances grew by 19% year-on-year, underpinned by strong retail loan growth, particularly in secured loans, which form a substantial part of the loan portfolio.
Looking forward, management emphasizes continuing investments in digital solutions to enhance customer experience and operational resilience. While shares of Axis Bank experienced a modest 2% decline over the past month, they have gained over 4% year-to-date, with longer-term performance revealing a 72% appreciation over five years. As Axis Bank navigates the current economic challenges with a focus on innovation and customer trust, investors may find potential upside in its solid financial foundation and proactive risk management strategies.
Source: The Economic Times
(Expert Note: This report was prepared by the Wealthova team.)