{"id":414152,"date":"2026-04-28T02:05:12","date_gmt":"2026-04-28T02:05:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/414152\/"},"modified":"2026-04-28T02:05:12","modified_gmt":"2026-04-28T02:05:12","slug":"strong-growth-amidst-margin","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/414152\/","title":{"rendered":"Strong Growth Amidst Margin …"},"content":{"rendered":"\n

This article first appeared on GuruFocus<\/a>.<\/p>\n

Release Date: April 25, 2026<\/p>\n

For the complete transcript of the earnings call, please refer to the full earnings call transcript<\/a>.<\/p>\n

Positive Points <\/p>\n

Axis Bank Ltd (FRA:UZC<\/a>) reported a strong all-round growth with total advances increasing by 19% year-on-year.<\/p>\n

The bank’s cost of deposits declined by 46 basis points year-on-year, showcasing effective funding strategy.<\/p>\n

Axis Bank’s GNPA ratio improved to 1.23%, declining 17 basis points quarter-on-quarter.<\/p>\n

The bank’s AI initiatives have been recognized globally, with Axis Bank being the only ISO 42,001 certified Business AI organization.<\/p>\n

Axis Bank’s subsidiaries reported a net profit growth of 16% year-on-year, contributing positively to the consolidated ROE.<\/p>\n

Negative Points <\/p>\n

Net interest margin (NIM) declined by 29 basis points year-on-year, reflecting challenges in maintaining margins.<\/p>\n

The bank’s trading profit and miscellaneous income were negative, mainly due to MTM losses on investments.<\/p>\n

Operating expenses increased by 6% year-on-year, indicating rising costs.<\/p>\n

The bank had to create an additional one-time provision of 2001 crores due to macroeconomic uncertainties.<\/p>\n

Axis Bank’s AFS Reserve was reported as a negative number, indicating potential challenges in asset valuation.<\/p>\n

Q & A Highlights <\/p>\n

Q: Can you explain if there is any day count convention benefit in your NIMS and if the full 25-basis points rate cut from December has been passed on your EBLR book? Also, is there any residual TD repricing left on your book? A: There is no day count representation in our NIMS; we follow the number of days in the quarter annualized for days in a year. The repo-linked book, which is 61%, has been fully repriced with the rate cut. We do have some residual TD repricing left as we move forward. (Respondent: Puneet Sharma, CFO)<\/p>\n

Q: With the sharp rise in wholesale deposit rates, do you think it warrants a focus moving back to margins? When do you expect to achieve the 3.8% through-cycle NIM guidance? A: We aim to maximize value by balancing NIM, growth, and risk profile. We expect to deliver a 3.8% NIM through the cycle, 15 to 18 months from the last rate cut transmission. (Respondent: Amitabh Chaudhary, MD and CEO)<\/p>\n

Q: What could be the loan yield uplift from the absence of interest reversal due to technical slippages next year? Is there a possibility of recoveries in technical slippages in the next fiscal? A: Gross slippages have declined, and net slippages are now at 0.07%. We anticipate no economic loss on this portfolio and expect to recover it over time, though we do not provide specific guidance on recovery timing. (Respondent: Puneet Sharma, CFO)<\/p>\n

Story Continues <\/p>\n

Q: Regarding the PSL full compliance, is it including PSLC purchases or is it organic? Also, could you quantify the absolute amount of AFS reserves as of March end? A: PSL compliance at headline and sub-segment levels includes PSLC purchases. Our AFS Reserve on a gross basis at 31st March 2026 is 254 crores, which is a negative number. (Respondent: Puneet Sharma, CFO)<\/p>\n

Q: With the strong pickup in retail disbursements and SME growth, do you see a need to calibrate your corporate loan growth? How do you think about the loan mix and its impact on RAROC and ROE? A: RAROCs remain healthy, and growth has not compromised asset quality. We manage leverage to retain our AAA rating, and while optimizing for NII with wholesale growth, we will recalibrate the book back to a balanced mix. (Respondent: Puneet Sharma, CFO)<\/p>\n

Q: Regarding the buffer provision created this quarter, if the situation worsens, would you draw down on these provisions this year itself? A: The provision is against an identified pool of loans. If loans from this pool slip due to the West Asia crisis, the provision will be utilized. It is different from previous contingency provisions. (Respondent: Puneet Sharma, CFO)<\/p>\n

Q: Given the tight deposit market, is there potential for deposit rates to rise from here? A: In the retail deposit market, banks have reduced pricing by 10-15 basis points, and further cuts are unlikely. In the wholesale market, rates have softened slightly after a year-end uptick, but it depends on factors like crude oil prices and currency. (Respondent: Neeraj Gambhir, Executive Director)<\/p>\n

Q: On the incremental disbursements, have you reverted to earlier credit filters, or are you open to taking more risk than before? A: The growth in disbursements is without loosening our risk filters. We remain prudent and do not expect to loosen our risk filters going forward. (Respondent: Puneet Sharma, CFO)<\/p>\n

For the complete transcript of the earnings call, please refer to the full earnings call transcript<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"This article first appeared on GuruFocus. Release Date: April 25, 2026 For the complete transcript of the earnings…\n","protected":false},"author":2,"featured_media":3020,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[45536,89275,114,66355,85,46,195548,91213,195546,195547],"class_list":{"0":"post-414152","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-axis-bank","9":"tag-basis-points","10":"tag-business","11":"tag-earnings-call-transcript","12":"tag-il","13":"tag-israel","14":"tag-negative-number","15":"tag-net-interest-margin","16":"tag-puneet-sharma","17":"tag-respondent"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/414152","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=414152"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/414152\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/3020"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=414152"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=414152"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=414152"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}