MUMBAI: The third largest private sector lender Axis Bank on Wednesday reported a massive growth in net income at Rs 7,130 crore as against a one-time loss of Rs 5,728 crore in the year-ago period after it bought out the retail banking unit of Citi India, marking a 17 percent improvement over the previous quarter. The numbers were boosted by balanced growth in advances and deposits along with an uptick in margins.
For the full year, the city-headquartered lender’s consolidated net income soared 160 percent to Rs 24,861 crore from Rs 9,580 crore on-year, which was also spooked by the massive Q4 loss last year. The management led by chief executive officer Amitabh Chaudhry attributed the good set of numbers to healthy margins coupled with balanced deposit and loan growth of 13 percent and 14 percent, respectively.
Analysts lapped up the numbers saying they are above their estimates. Rahul Malani, a research analyst at Sharekhan by BNP Paribas said, “Axis Bank reported better-than-expected number in Q4 led by better NIMs and higher treasury gains and supporting other numbers too”.
The key operational metric of net interest income, which is the income a bank earns from loans after paying for the deposits, rose 11 percent to Rs 13,089 crore, and for the full year touched Rs 49,894 crore.
Interest income grew on the back of higher advances and the margin or net interest margin it earned. Margin gained 5 bps to 4.06 percent and the fee income grew 23 percent. Of this, retail fee grew 33 percent.
The bank’s balance-sheet grew to Rs 14.77 trillion as of end March, of which deposits were Rs 10.68 trillion and assets were Rs 9.65 trillion, up from Rs 13.17 trillion in March 2023, the chief financial officer Puneet Sharma told reporters in an earnings call. Total business grew 13 percent, of which advances jumped 14 percent.
The finance head said the bank’s personal loans grew 10 percent to Rs 71,592 crore, which is 12 percent of the total assets of over Rs 9.8 trillion. Overall retail loans grew 20 percent of which SME loans were up 17 percent and the corporate loan book grew at a marginal 7 percent.
Gross non-performing assets stood at 1.43 percent, down from 2.02 percent from the year-ago period and net NPAs came in at 0.31 percent from 0.39 percent on-year.
The gross slippage ratio came in at 1.48, down 28 bps and net slippage ratio came in at 0.57. Provisions and contingencies stood at Rs 1,185 crore and specific loan loss provisions for the quarter stood at Rs 832 crore. The bank holds cumulative provisions, which is for standard loans and additional provisions other than for NPAs, of Rs 12,134 crore as of March 2024.
Overall capital adequacy ratio stood at 16.63 with CET 1 ratio at 13.74. Net organic accretion to CET-1 of 44 bps in FY24.
The bank added 125 branches during the final quarter of the year and 475 through FY24, taking the overall network to 5,377 domestic branches.
The board has recommended a dividend of Re 1/equity of face value of Rs 2 for the year.
The Axis counter which has been underperforming for long now, in anticipation of good numbers gained 0.72 percent at Rs 1064.05 on the BSE.