Axis Bank Shares Plunge Nearly 5% After Q4 Results Fail to Impress D-Street

Axis Bank shares witnessed a sharp decline of over 4.5% on Friday after reporting muted Q4 results. The banking firm's net profit figure stood at Rs 7,118 crore for the quarter ending March, marking a slight year-on-year decline. Axis Bank's net interest income stood at Rs 13,811 crores, witnessing a YoY surge of 6%, whereas net interest margin (NIM) for the quarter stood at 3.97%.

At 10:45 am, the shares of the banking firm were trading at Rs 1,153.30 price level, down by 4.46% on the National Stock Exchange.

“The Bank prioritised profitability over growth, considering the uncertain macros and tight liquidity environment dominating most of FY25 while continuing to meaningfully invest in making the franchise more sustainable. As we enter FY26, we believe the operating environment is improving, which should help us drive both growth and profitability," said Amitabh Chaudhry, MD and CEO at Axis Bank.

The banking firm saw operating expenses growth moderate at 6.5% in FY25. Retail loans grew by 7% on a YoY basis, whereas corporate loans increased by 8% in the same period.

Outlook Ahead

Analysts are expecting the outlook to remain under pressure in FY26 owing to policy rate cut. Plus, elevated credit costs might further dampen the outlook.

"NII was in-line but moderate due to weak loan growth and some sequential uptick in margin. Though stress in unsecured segment has started abating but would take a few more quarters to normalize. Lack of clarity on growth and elevated credit cost for FY26 dampens the sentiment, thus pushing earnings growth further down the line," Phillip Capital said in a report.

Asset quality, on the other hand, improved slightly as slippages remained under control, while the GNPA/NNPA ratio improved sequentially. Deposits grew 7% QoQ, while advances grew 3% QoQ, leading to an improvement in the CD ratio to 88.7%.

"Given the rate cut, margins are expected to remain under check. We fine-tune our earnings and estimate FY27E RoA/RoE of 1.7%/15.0%. Reiterate Neutral with a target price of Rs 1,300," Motilal Oswal stated in a report.

Kotak Institutional Securities has reiterated its 'BUY' recommendation, maintaining a fair value (FV) of Rs 1,500, unchanged from previous estimates. "We are revising our estimates by 1.7-2% for FY2026-27, building conservative loan growth and compression in NIM to reflect the rate cycle," the brokerage said.