Jefferies reiterated its ‘Buy’ rating on Axis Bank with a target price of ₹1,400, indicating a potential upside of 34% from the current market price of ₹1,044.00. The brokerage noted that the bank’s Q3 profit exceeded estimates, supported by a strong pre-provision operating profit (PPOP) growth of 15%.
While deposit growth lagged the sector average of 10%, the bank’s 13% average growth was deemed reasonable and better than the benchmark. Slippages rose marginally quarter-on-quarter, primarily driven by agricultural and microfinance loans, but unsecured loans remained largely stable, providing some reassurance.
Jefferies highlighted that sustaining average deposit growth near current levels and moderating slippages will be critical for a re-rating.
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