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Informist, Wednesday, Jul 24, 2024

 

--Axis Bank Apr-Jun net profit 60.35 bln rupees 

--Analysts saw Axis Bank Apr-Jun net profit 64.65 bln rupees 

--Axis Bank Apr-Jun net profit 60.35 bln rupees vs 57.97 bln 

--Axis Bank Apr-Jun total income 358.44 bln rupees 

--Axis Bank Apr-Jun total income 358.44 bln rupees vs 306.44 bln 

--Axis Bank Apr-Jun provisions 20.39 bln rupees vs 10.35 bln 

--Axis Bank gross NPA ratio 1.54% as on Jun 30 vs 1.43% qtr ago 

--Axis Bank net NPA ratio 0.34% as on Jun 30 vs 0.31% qtr ago 

--Axis Bank Basel III capital adequacy ratio 16.65% as on Jun 30

--Axis Bank Apr-Jun NII 134.48 bln rupees, up 12% on year 

--Axis Bank Apr-Jun domestic NIM 4.14% vs 4.16% qtr ago

--Axis Bank Apr-Jun overall NIM 4.05% vs 4.06% qtr ago 

--Axis Bank net advances 9.80 trln rupees as on Jun 30, up 14% on yr

--Axis Bank total deposits 10.62 trln rupees as on Jun 30, up 13% on yr 

--Axis Bank current, savings account ratio 42% as on Jun 30 

--Axis Bank retail loans 5.85 trln rupees as on Jun 30, up 18% on yr 

--Axis Bank SME loans 1.04 trln rupees as on Jun 30, up 20% on yr 

--Axis Bank Apr-Jun credit cost stood at 1.19% 

--Axis Bank Apr-Jun fresh slippages 47.93 bln rupees 

--Axis Bank Apr-Jun upgrades, recoveries 15.03 bln rupees 

--Axis Bank Apr-Jun write-off 22.06 bln rupees 

--Axis Bank: Issued 1 mln new credit cards in Apr-Jun

--Axis Bank: Formed new unit within bank to find suspicious, mule accts 
--Axis Bank: Want to grow home loan book in a calibrated manner 
--Axis Bank: Expect credit costs to go higher 
--Axis Bank: Need to factor in seasonality for on-quarter rise in NPAs 
--Axis Bank: Completed final migration of Citi India customers in Jul 
 

By Kshipra Petkar

 

MUMBAI – Axis Bank's net profit for the quarter ended June fell 15.4% sequentially to 60.35 bln rupees. The rise in provisions and decline in asset quality hit the bottomline of the bank in the reporting quarter. Net profit, however, rose by a marginal 4% on year.  

 

Provisions and contingencies of the bank nearly doubled on year to 20.39 bln rupees in Apr-Jun. On a sequential basis, provisions rose 72.1%. "Specific loan loss provisions for Apr-Jun stood at 25.51 bln rupees," the bank said in a press release.

 

The asset quality of the bank also took a hit as the gross non-performing asset ratio came in at 1.54% as on Jun 30 from 1.43% a quarter ago. The net non-performing asset ratio also rose to 0.34% as on Jun 30 from 0.31% seen a quarter ago. The bank's management in a post-earnings conference call said that seasonality has to be factored in for the sequential rise in non-performing assets. 

 

"Our net NPA is up 3 basis points quarter on quarter. The 3 bps increase is because there is seasonality in the first and third quarter within the retail agri business. One has to build in seasonality," Puneet Sharma, chief financial officer at Axis Bank said in the call.

 

The bank's total income for the reporting quarter was 358.44 bln rupees, higher than 306.44 bln rupees in the year-ago period. The net interest income grew 12% on year to 134.48 bln rupees. The domestic net interest margin moderated to 4.14% from 4.16% reported a quarter ago and the overall net interest margin was at 4.05% compared to 4.06% as seen in the previous quarter.  More

 

In the reporting quarter, the bank reported fresh slippages of 47.93 bln rupees and recoveries and upgrades of 15.03 bln rupees. The lender also wrote-off loans of 22.06 bln rupees. The bank's management also said that the slippages were mostly coming from the retail portfolio.

 

The net advances of the bank were up 14% on year at 9.80 trln rupees as on Jun 30, and the retail book made up the largest share of advances at 60%. The retail book grew 18% on year to 5.85 trln rupees, as per the bank's investor presentation. Home loans were up 6% on year at 1.65 trln rupees and personal loans were up 29% on year to 736.20 bln rupees. The bank's management said that it wants to grow the home loan book in a well calibrated manner.

 

The small and medium enterprise segment book remains well diversified across geographies and sectors, and was up 20% on year to 1.04 trln rupees. Corporate loan book grew 6% on year to 2.91 trln rupees. The domestic corporate book grew 7% on year and the mid-corporate book grew 24% on year.

 

While discussing the outlook on the bank's credit costs, the bank's management said that it expects credit costs to increase. "...what we continue to indicate is (that) for certain parts of the unsecured portfolio, we are seeing credit costs rise, but they remain well within our risk guardrail," it said. The credit costs for the reporting quarter were at 1.19%.

 

Total deposits grew 13% on year to 10.62 trln rupees as on Jun 30. Out of which current account deposits grew 12% on year to 1.50 trln rupees and total term deposits grew 20% on year to 6.18 trln rupees. The share of CASA deposits in total deposits was at 42%.

 

In terms of capital requirements, the management said that the bank is well capitalised. The Basel-III capital adequacy ratio of the bank was at 16.65% as on Jun 30.  "The bank now has a self-sustaining capital structure to fund growth, with organic net capital accretion through profits to CET-1 of 32 basis points for Apr-Jun," the bank said in its press release. 

 

The bank added 50 branches during the quarter, taking its overall distribution network to 5,427 domestic branches, the release said. On the credit card business front, the bank issued 1 mln new credit cards in the quarter under review. The market share of the cards in force was at 14%. 

 

Keeping in mind the Reserve Bank of India's concern on mule accounts, the bank has made a special unit within the bank called the 'Financial crime intelligence unit' to look out for suspicious accounts and mule accounts. On Jul 3, RBI Governor Shaktikanta Das urged banks to step up efforts against mule accounts. The bank announced its earnings post market hours. Today, shares of the bank closed 1.9% lower at 1,239.25 rupees on the National Stock Exchange.  End

 

Edited by Aditya Sakorkar

 

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