Axis Bank Research Tear Sheet Q3 FY22

Axis Bank Limited is a private sector Indian bank. It mainly deals with banking and financial services. It is headquartered in Mumbai, Maharashtra. It was initially incorporated as UTI Bank in 1995. The bank has several subsidiaries Axis Asset Management Company Ltd., Axis Mutual Fund Trustee Ltd., Axis Capital Ltd, Axis Finance Ltd, Axis Securities Ltd, A.TREDS Ltd., Axis Bank UK Ltd, Axis Trustee Services Ltd, Free charge, Accelyst Solutions Private Ltd. and Axis Private Equity Ltd. Axis Bank has 78,300 employees by 2021.

Key Financial Highlights

Net Interest	Q3 FY 22	YOY Gowth
Net Interest Income	8,653	17%
Operating Expense	6,331	25%
Operating Pofit	6,162	5%
Net Profit	3,614	224%

In	Q3 FY 22	YOY Gowth
Total Assets	11,13,066	20%
Net Advances	6,64,866	17%
Total Deposits	7,71,670	20%

Operating profit grew 17% YOY & 4% QOQ. The Net Interest Income up 17% YOY & 10% QOQ.  Fee income grew 15% YOY & 3% QOQ basis. The Total deposits increased 22% YOY & 3% QOQ. Loans increased by 17% YOY &7% QOQ. The Retail up 18% YOY & 6% QOQ. GNPA% at 3.17% declined by 138 bps YOY and 36 bps QOQ. NNPA% at 0.91% declined by 28 bps YOY and 17 bps QOQ. More than 0.77 million credit cards issued in Q3FY22, highest ever for any quarter. Operating expenses to average assets stood at 2.15% for Q3 FY’22, higher by 19 bps YOY and three bps on a sequential quarter basis. Net loan slippage ratio for the quarter annualized is 0.06%, improving 380 bps YOY and 38 bps QOQ.

Loan growth

Retail loans grew 18% YOY and 6% QOQ, Retail disbursements increased by 37% YOY and 19% QOQ and SME loans up 20% YOY and 9% QOQ,  Corporate loan book  increased by 13% YOY and 7% QOQ, Mid-corporate book grew 44% YOY & 17% QOQ.

Outlook

Expects that the first journeys  be in beta phase in Q4.

 2% cost-to-assets target on an FY’23 exit basis.

Axis AMC

Axis AMC’s average AUM for the quarter increased by 43% YOY to `2,53,450 crores. Profit after Tax increased by 54% YOY to `252 crores in 9MFY22.AMC has performed significantly well in the quarter due tostrong leadership team and innovative product launches on the equity savings.

Axis Finance

Axis Finance maintains a Capital Adequacy Ratio of 19.8%. Profit After Tax was `113 crores increased by 77% YOY in Q3FY22. Profit after Tax increased by 81% YOY to `251 crores from `139 crores in 9MFY21. Axis Finance has built a strong customer base through Franchaisee.

Axis Capital

Axis Capital completed 16 and 43 ECM transactions in Q3FY22.Profit After Tax for Q3FY22 and 9MFY22 increased by 118% YOY and 88% YOY respectively.

Axis Securities

Axis Securities’ broking revenues grew 58% and 65% YOY in  Q3FY22 & 9MFY22  to `175 crores &`482 crores respectively.

Conference Call Highlights:

Management guidance:                   

Deposit increased by 22% YOY and 3% QOQ (on Quarterly Average Balance basis) and added 2.15 million new customer accounts.

Advances grew by 17% YOY and 7% QOQ in Retail, Corporate and Commercial Bank.

Wealth Management with an AUM of Rs 2.67 lakh crores. Increased by 37% YOY and 3% QOQ.

CASA deposits on a QAB basis increased 25% YOY and 7% QOQ. The CASA ratio stands at 44%.

Business Update:

Axis Bank has entered into a SOFR trade finance deal.

Axis Bank has come out to be the highest bidder of Citi Customer Biz.

Axis Bank has received RBI approval to re-designate Rajiv Anand as Deputy MD.

Axis Bank has signed MoU with Indian Navy for initiating salary accounts.

Axis Bank opened UPI to help its customers.

Axis Bank Reappointed Amitabh Chaudhry As MD and CEO.

Axis Bank appointed Bain Capital’s Ashish Kotecha as nominee director.

Others:

The market share on UPI stood at 15%. 5.4 million Non-Axis Bank customers are using our Axis mobile and Axis Pay apps.