Trade Nivesh | here are highlights of analyst call
Axis Bank was back in the black in the December quarter, reporting a 4.5 percent year-on-year gain in net profit at Rs 1,757 crore.
The private sector lender had reported a loss of Rs 112.08 crore in the previous quarter.
Net interest income (NII) of the bank grew 15.16 percent year-on-year to Rs 6,452.98 crore, while net interest margin was at 3.57 percent, the highest in the last 10 quarters.
Loan growth was strong for the quarter at 5.5 percent sequentially and 16 percent YoY, indicating the bank has been gaining market share along with healthy NII.
Here are the highlights of Axis Bank's analyst call on earnings collated by Narnolia Financial Advisors:
Q4 expectations
The bank expects a loan growth of 5-7 percent above the industry level.
The net interest margin (NIM) is expected to be higher than FY19. However, NIM for 4QFY20 will have some impact due to LCR accounting change.
The management is confident of credit cost moderating over the medium term.
Slippages
The bank’s total slippages for the quarter stood at Rs 6,214 crore, including corporate slippages of Rs 3,891 crore, of which 81% came from BB and below rated clients.
Retail slippages increased moderately due to risk in CV segment. The management says that retail risk might increase in CV and MFI segment.
The microfinance trouble is limited to Assam and Karnataka, where the weightage is less than 10%.
New branches
The bank has, so far, opened 365 branches in FY 20, the highest in last six years to take the domestic branch network to 4,415.
The bank is looking to open 550 branches in the current year.
Attrition rate increases
The bank hired 12,000 people, so far, in FY20, compared to 3,000 in the same period in the last fiscal. The attrition rate has gone up but it is marginally below the industry.
Provisions
The bank has additional provisions of Rs 2,558 crore over and above the regular NPA provisioning and the 0.4% standard assets provisioning requirement, which are not counted in PCR calculation.
The bank has taken 100% provisioning of Rs 2,209 crore for a 300-acre land parcel.
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Axis Bank was back in the black in the December quarter, reporting a 4.5 percent year-on-year gain in net profit at Rs 1,757 crore.
The private sector lender had reported a loss of Rs 112.08 crore in the previous quarter.
Net interest income (NII) of the bank grew 15.16 percent year-on-year to Rs 6,452.98 crore, while net interest margin was at 3.57 percent, the highest in the last 10 quarters.
Loan growth was strong for the quarter at 5.5 percent sequentially and 16 percent YoY, indicating the bank has been gaining market share along with healthy NII.
Here are the highlights of Axis Bank's analyst call on earnings collated by Narnolia Financial Advisors:
Q4 expectations
The bank expects a loan growth of 5-7 percent above the industry level.
The net interest margin (NIM) is expected to be higher than FY19. However, NIM for 4QFY20 will have some impact due to LCR accounting change.
The management is confident of credit cost moderating over the medium term.
Slippages
The bank’s total slippages for the quarter stood at Rs 6,214 crore, including corporate slippages of Rs 3,891 crore, of which 81% came from BB and below rated clients.
Retail slippages increased moderately due to risk in CV segment. The management says that retail risk might increase in CV and MFI segment.
The microfinance trouble is limited to Assam and Karnataka, where the weightage is less than 10%.
New branches
The bank has, so far, opened 365 branches in FY 20, the highest in last six years to take the domestic branch network to 4,415.
The bank is looking to open 550 branches in the current year.
Attrition rate increases
The bank hired 12,000 people, so far, in FY20, compared to 3,000 in the same period in the last fiscal. The attrition rate has gone up but it is marginally below the industry.
Provisions
The bank has additional provisions of Rs 2,558 crore over and above the regular NPA provisioning and the 0.4% standard assets provisioning requirement, which are not counted in PCR calculation.
The bank has taken 100% provisioning of Rs 2,209 crore for a 300-acre land parcel.
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