Axis Bank Shares Slump After Q4 Results: Should You Buy, Sell Or Hold?

Axis Bank’s share price continued to slump for the second straight day as the bank declared its Q4 earnings on Thursday.

What Happened: The private bank’s Net Interest Income (NII) – the difference between the income a bank makes from its lending activities and the interest it pays to depositors – grew 33% year-over-year and 2% sequentially to 11,742 crores. Net interest margin (NIM) for the quarter ended March stood at 4.22%, up 73 bps YoY.

The bank however booked losses of ₹5,361.9 crore in the final quarter of FY23 (April 2022- March 2023). The massive loss was due to the private bank’s purchase of Citibank’s India Consumer Business. The lender informed that barring the exceptional items that led to the loss on the books, the private lender’s net profits stood at ₹6,625 crore up 61% YoY. The bank also announced a dividend of ₹1/share.

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Brokerages were impressed by the bank’s Q4 performance. Jefferies initiated coverage on the stock with a ‘buy’ rating with a price target of ₹1,150. The firm noted that the lender posted strong Q4 numbers and has scope for better growth ahead. Macquarie maintained its outperform rating for the stock with a price target of ₹940.

Domestic brokerage firms also remain strongly bullish on the stock. HDFC Securities maintained the ‘buy’ call on the stock slightly increasing the price target to ₹1,130 from 1,118. Yes Securities also reiterated its ‘buy’ call for the stock with a price target of ₹1,300 – an over 45% upside from the stock’s last closing price of ₹881.40.

Price Action: Axis Bank’s share price was down 2.96% to trade at ₹855.30 in the afternoon hours of trading on Friday.

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