Axis Bank’s share price dropped ahead of its Q2 results, but analysts remain optimistic, predicting an 8-9% year-on-year rise in net profit, primarily driven by higher net interest income (NII). While slippages are expected to increase by 29% YoY, they are forecasted to decline by 12% on a quarterly basis. Additionally, NII is anticipated to grow by around 10% compared to the same period last year.
Axis Bank’s share price dipped by about 1.60% in morning trade on Thursday, October 17, ahead of its Q2 (July-September) results. The stock opened at ₹1,152.95, slightly higher than its previous close of ₹1,152.25, but soon slipped by 1.6%, hitting ₹1,134. By 10:25 am, the stock was trading 1.5% lower at ₹1,135.35.
Axis Bank Q2 preview
Experts are forecasting an 8-9% year-on-year (YoY) increase in Axis Bank’s net profit for Q2 FY25, largely driven by a rise in net interest income (NII) and improved slippages. According to reports, the bank’s NII is expected to grow by 10% YoY, while slippages are anticipated to increase by 29% YoY but decrease by 12% on a quarterly basis.
Motilal Oswal Financial Services projects a higher net profit growth of 13% YoY for Axis Bank in Q2, with NII expected to rise by 10.7% YoY. The brokerage also notes that the credit-deposit (CD) ratio may remain high, with margins expected to moderate. Asset quality and cost ratios will be key areas of focus in the bank’s upcoming results.
Nuvama Institutional Equities expects Axis Bank’s core profit after tax (PAT) to rise by 10% YoY, with pre-provision operating profit (PPoP) likely growing by 18% YoY.
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They anticipate NII to increase by 1.8% QoQ and 11.2% YoY, though margins may see a slight dip of around 3 basis points. The rise in NII, stronger non-interest income, and reduced provisions are expected to drive the higher PAT. However, loan growth is predicted to be modest, coming in at under 1% QoQ.
Axis Bank share price trend
As of October 16, Axis Bank shares have risen approximately 4.5% this year, but this is below the benchmark Sensex, which has gained around 13% during the same period.
On a monthly basis, the stock has declined nearly 4% in October. If it closes the month in the red, it will break a winning streak that has lasted for the past four consecutive months.
The stock reached its 52-week high of ₹1,339.55 on July 12, 2023, while its 52-week low was ₹951.55 on October 25, 2022.
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