{"id":133190,"date":"2022-08-15T08:58:02","date_gmt":"2022-08-15T12:58:02","guid":{"rendered":"https:\/\/44.250.171.167\/?p=133190"},"modified":"2022-08-15T10:48:35","modified_gmt":"2022-08-15T14:48:35","slug":"axis-bank-ltd-research-summary","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/axis-bank-ltd-research-summary\/","title":{"rendered":"Axis Bank Ltd Q1 FY23 Research Summary"},"content":{"rendered":"\n

Stock Data<\/strong><\/p>\n\n\n\n

Ticker: AXISBANK<\/p>\n\n\n\n

Exchange :NSE and BSE<\/p>\n\n\n\n

Industry: Banking<\/p>\n\n\n\n

Price Performance<\/strong><\/p>\n\n\n\n

Last 7 days    4.40%<\/p>\n\n\n\n

YTD                 12.08%<\/p>\n\n\n\n

Last 12 months     0.42%<\/p>\n\n\n\n

\u201cOur core operating performance in the current quarter is strong, with meaningful improvement in NIMs, growth in NII, core operating profit, benign credit costs and significant improvement in our ROA and ROE.\u201d<\/p>\n\n\n\n

MR. PUNEET SHARMA \u2013 CFO, AXIS BANK<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The main source of income of a banking sector is interest earned from various loans. The bank has earned Rs 63,645.29 Cr. In revenue in the latest financial year with a growth rate of 11.61% in the last threeyears. The growth in advances in last 3 years stood at 12.36%. The ROA is average which is 0.69%. The company has a healthy Capital Adequacy Ratio of 15.40 and it is trading at a P\/B of 1.95.<\/p>\n\n\n\n

Investment Thesis<\/strong><\/p>\n\n\n\n

Financial Snapshot<\/u><\/strong>– Net Interest Income increased by 21% YOY and 6% QOQ. NIM  stood at 3.60%, increased  14 bps YOY and 11 bps QOQ. Core operating profit increased 17% YOY and 5% QOQ. PAT increased 91% YOY to Rs 4,125 crores. ROE stood at 15.66%, increased 587 bps YOY. Fee income increased by 34% YOY to Rs 3,576 crores. Non-interest income stood at Rs 2,999 crores.<\/p>\n\n\n\n

Operational Efficiency<\/u><\/strong>– The bank has successfully reduced GNPA% at 2.76%. It has declined by 109 bps YOY & 6 bps QOQ, NNPA% stood at 0.64%. It declined by 56 bps YOY and 9 bps QOQ. The bank has issued 0.99 million credit cards in this quarter.<\/p>\n\n\n\n

Digitization<\/u><\/strong>\u2014The bank has launched KYC and income verification via digital or physical channels. The market share in mobile banking increased by 15%. The bank has 9.7 million monthly active users on Axis Mobile Banking. It has maintained a market share of 16% as Payer PSP (by volume) and 22% in UPI P2M Acquiring (by throughput). 42% – New mutual fund SIPs sourced (by volume) through digital channels. 68% – Retail term deposits are opened digitally.<\/p>\n\n\n\n

Business Strategy<\/u><\/strong>-Axis Bank has initiated dedicated IT cloud infrastructure to handle high volume UPI transactions. The bank has focused on corporate salary acquisition. 65% of branch service requests are now delivered through digital channels. The bank has initiated API driven digital collections with virtual account validations. It has introduced small ticket Suvidha Loans. Leveraging AVC Channel for better lead conversion.<\/p>\n\n\n\n

Business Outlook<\/u><\/strong>-The bank targets to grow segments like retail, SME and Mid Corporate with better RAROC continue to grow faster at 25%, 27% and 54% respectively. The bank targets to achieve ROE of 16% to 16.5%.<\/p>\n\n\n\n

Company Descriptions- <\/u><\/strong>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. It is the third  largest Private Bank in India. It has 4,759 branches and 86,400+ Employees. 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, Accelyst Solutions Private Ltd. and Axis Private Equity Ltd.<\/p>\n\n\n\n

The bank has its presence in the  overseas market as well. It has branches located in Dubai, Shanghai, Hong Kong, Colombo, Singapore, and Gift-city-IBU.  It has representative offices in Sharjah, Abu Dhabi, Dubai, and Dhaka. The overseas subsidiary of Axis bank is located  in London, UK.<\/p>\n\n\n\n

Product Portfolio<\/u><\/strong>– The bank deals with a wide range of products like<\/p>\n\n\n\n

Retail- Accounts, Deposits,Cards, Loans, Forex, Investments, Insurance,Start a SIP and FASTag<\/p>\n\n\n\n

Agri and Rural-Loans,Rural Banking and Financial Inclusions.<\/p>\n\n\n\n

Shareholding in Percentage<\/u><\/strong><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Industry Analysis<\/u><\/strong>– The demand for banking sector grew due to increase in population and growing disposable income. The Indian banking sector consists of 12 public sector banks, 22 private sector banks, 44 foreign banks, 43 regional rural banks, 1,484 urban cooperative banks and 96,000 rural cooperative banks and credit institutions. The government has introduced number of measures to boost the banking sector. Moreover with the advent of Information Technology the banking sector has successfully moved towards digitization. After COVID-19 banks have moved toward digitization. The customers prefer online banking over in-person banking. The bank processes are now conducted with much more ease.The Banking system flaunts some user friendly apps for its customers. Digitization has brought cost effectiveness to the industry. It has enabled easy and super-quick cashless transactions. It provides a secure way of Cybersecurity, which is also important in banking.<\/p>\n\n\n\n

Peer Comparison<\/u><\/strong><\/p>\n\n\n\n

Company Name<\/strong><\/td>MCap(Cr)<\/strong><\/td>TTM PE<\/strong><\/td>P\/B<\/strong><\/td>ROE(%)<\/strong><\/td><\/tr>
Axis Bank<\/td>2,33,604.05<\/td>14.47<\/td>1.97<\/td>11.93<\/td><\/tr>
HDFC Bank<\/td>8,25,429.67<\/td>20.75<\/td>3.33<\/td>15.38<\/td><\/tr>
ICICI Bank<\/td>6,08,485.56<\/td>20.75<\/td>3.94<\/td>13.79<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Based on investor perspectiveHDFC is in a better position compared to Axis Bank. HDFC has better MCap and ROE followed by ICICI and Axis Bank. But the share of Axis Bank will be a good choice in the longrun.<\/p>\n\n\n\n

Our View<\/u><\/strong>– The bank needs to concentrate more on P\/E ratio. The CAGR return is 4% in last 3 years. The company has a low ROE compared to other major players. The bank should concentrate more on improving the P\/E ratio and CAGR. But the bank has successfully delivered a good Profit growth over the past 3 years.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n
\"\"<\/figure>\n","protected":false},"excerpt":{"rendered":"

Stock Data Ticker: AXISBANK Exchange :NSE and BSE Industry: Banking Price Performance Last 7 days    4.40% YTD                 12.08% Last 12 months     0.42% \u201cOur core operating performance in the current quarter is strong, with meaningful improvement in NIMs, growth in NII, core operating profit, benign credit costs and significant improvement in our ROA and ROE.\u201d MR. […]<\/p>\n","protected":false},"author":1796,"featured_media":58681,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1941,6352,9908,6350],"tags":[151,8249],"class_list":["post-133190","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-analysis","category-research-summary","category-research-tear-sheet","category-trending-stocks","tag-banking","tag-banks"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2020\/04\/Research-summary.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":128734,"url":"https:\/\/alphastreet.com\/india\/axis-bank-research-tear-sheet-q4-fy-2022\/","url_meta":{"origin":133190,"position":0},"title":"Axis Bank Research Tear Sheet Q4 FY 2022","author":"sreerupa","date":"May 2, 2022","format":false,"excerpt":"Axis Bank Limited is a private sector Indian\u00a0bank. 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