Synopsis: Axis Bank is expected to report a notable 8% growth in net profit for Q2 FY24, largely attributed to a 10% YoY increase in net interest income and lower slippages compared to the previous quarter. However, the bank’s loan growth remains moderate at 11% YoY, and slippages are predicted to rise 29% YoY. Analysts also expect a stable net interest margin (NIM) of 3.8%, while loan growth and fee income could remain sluggish.
Axis Bank, one of India's leading private lenders, is forecasted to post an 8% year-on-year (YoY) increase in net profit for the second quarter (Q2) of FY24.
The predicted growth is driven by a 10% rise in net interest income (NII) and a reduction in slippages on a sequential basis.
Loan growth is expected to rise 11% YoY, but slippages are projected to increase by 29% YoY.
Key Financial Expectations:
- 8% YoY growth in net profit.
- 10% YoY increase in net interest income (NII).
- Slippages up 29% YoY but down 12% sequentially.
- Loan growth expected to rise 11% YoY.
Analysts from brokerages like Kotak Equities and Nuvama predict Axis Bank will show steady loan growth but caution against rising slippages, particularly in the retail segment.
Meanwhile, fee income growth may remain subdued, reflecting the bank’s weak loan growth during the quarter.
In conclusion, Axis Bank's Q2 FY24 results signal a cautious but stable financial trajectory.
While its net profit is set to grow, concerns over rising slippages and subdued loan growth persist.
The market will closely watch the bank's ability to maintain its margins and manage its slippage ratio, especially from the unsecured segment.
Investors are advised to monitor Axis Bank's asset quality and operating metrics moving forward.
Disclaimer: This article provides financial information for educational purposes only. It should not be considered investment advice. Readers are encouraged to consult with financial professionals before making investment decisions.
