CLSA has reiterated its outperform rating on Axis Bank with a target price of ₹1,500 per share, citing a strong Q3 performance led by better-than-expected operating metrics.
The brokerage highlighted that net interest income, core pre-provision operating profit (PPOP) and profit before tax all beat estimates. Loan growth accelerated to 14% YoY, supported by favourable sectoral tailwinds.
Margins declined 9 bps QoQ, but CLSA noted that this was more than offset by sharp cost control. Operating expenses fell 3% QoQ, driven by lower employee costs and reversals, which boosted operating leverage.
Asset quality was the standout, according to CLSA. Excluding technical slippages, gross slippages declined 21% YoY, with improvement largely driven by the unsecured retail portfolio. Credit costs came in at 0.8%, beating CLSA’s estimate of 1%.
CLSA believes the combination of accelerating growth, improving asset quality and controlled costs strengthens Axis Bank’s earnings visibility going forward.
Disclaimer: The views and recommendations above are those of CLSA. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
