Cost control, modest loan growth, and low previous year base may aid Aix Bank to report healthy set of numbers for the December quarter of FY21 (Q3FY21). The lender, which is scheduled to report the Q3 results on Wednesday, January 27, had clocked a net profit of Rs 1,756.9 crore in Q3FY20, and of Rs 1,682.7 crore in the September quarter of FY21 (Q2FY21).
The estimates of Motilal Oswal Financial Services shows Axis Bank can report a 14.7% YoY (YoY) growth in NII. Operating profit can rise by 18.9% YoY. Gross NPA may stand at 5% for Q3FY21 while net NPA may come at 1.4%t, said Motilal.
Here’s what leading brokerages expect:
- Kotak Institutional Equities
It expects loan growth at 7% YoY with a greater focus on retail while operating profit growth may come at 11% YoY led by better cost controls. Kotak expects Axis Bank to report slippages of about Rs 5,000 crore (nearly 4.5% of loans) subject to the court ruling. - Motilal Oswal Financial Services
Including a 14.7% YoY growth in NII at Rs 7,400 crore, MOFSL projects the lender’s total revenue at Rs 11,460 crore for the quarter under review. Adjusting for operating expenses, operating profit is pegged at Rs 6,830 crore, up nearly 19% YoY. However, owing to higher provisions, the brokerage expects the bank’s PAT to decline 14.6% on year to Rs 1,500 crore. The provisions are seen at Rs 4,830 crore for Q3FY21, up from Rs 3,470.9 crore set aside in Q3FY20, and Rs 4,580.7 crore in Q2FY21. - Edelweiss Securities
The brokerage expects loan momentum to improve as compared to last quarter, while is sees retail deposits growth to be steady. It would, however, monitor traction on corporate deposits. - Philip Capital
Brokerage firm Phillip Capital expects Axis Bank’s NIM to remain stable QoQ despite MCLR cut owing to the declining cost of fund. Phillip Capital expects a 17.3%YoY rise in December-quarter NII. Total loan-related provision is expected to reach 5.1% of loan book against 4.9% in Q2, said the firm.