Axis Bank Q1 Results Review - Focus On Profitability, Business Investments: Prabhudas Lilladher

"BQ Prime’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 BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Prabhudas Lilladher Report.Axis Bank Ltd. saw a good quarter; although core profit after tax was a miss due to higher opex, net interest income was 3% ahead to our estimate leading to net interest margin at 4.17% (beat by 17 basis points). Axis Bank's NIM boost was driven by-strong QoQ growth in higher margin segments of personal loan, credit card and small busines banking,deliberate slowdown in housing,6% QoQ fall in liquidity coverage ratio andlower deposit growth of 0.6% QoQ resulting in higher loan-to-deposit ratio. Registered Transferable Deposit growing by 4.5% QoQ was another positive. Balance sheet construct is being calibrated towards higher margin segments and granular deposits which could slightly affect loan growth. However, this should bode well over medium term from a profitability perspective. CITI integration costs and business investments would keep opex elevated. For FY24/25E we raise NIM and opex while reduce provisions resulting in ~3% profit after tax upgrade. With likely return on asset of 1.7% for FY25E, valuation discount to ICICI Bank Ltd. (27%) should narrow. We maintain multiple at 2.2 times but raise target price to Rs 1,170 from Rs 1,140. Reiterate ‘Buy’.Click on the attachment to read the full report:.Axis Bank Q1 Results Review - Net Interest Margins Declined QoQ; Return On Asset At 1.8%: IDBI Capital.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner."

Axis Bank Q1 Results Review - Focus On Profitability, Business Investments: Prabhudas Lilladher

With likely return on asset of 1.7% for FY25E, valuation discount to ICICI Bank (27%) should narrow.

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Axis Bank Q1 Results Review - Focus On Profitability, Business Investments: Prabhudas Lilladher

With likely return on asset of 1.7% for FY25E, valuation discount to ICICI Bank (27%) should narrow.

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