KR Choksey has given Buy recommendation for Axis Bank with a target price of Rs. 936 in its research report issued on Jan 27, 2022
KR Choksey’s research report on Axis Bank
AXSB’s Net Interest Income (NII) grew 17.4% YoY to INR 86,525 Mn in Q3FY22. Net interest margin (NIM) for Q3FY22 stood at 3.53%. • AXSB’s operating profit for the quarter was INR 61,615 Mn. Fee income for Q3FY22 grew 15% YoY and 3% QoQ to INR 33,440 Mn. Net profit grew 224% YoY from INR 11,166 Mn in Q3FY21 to INR 36,142 Mn in Q3FY22. The total deposits grew by 20% YoY. On QAB basis, savings account deposits grew 24% YoY and 4% QoQ. The Bank’s advances grew 17% YoY to INR 66,48,656 as on 31st December 2021. The Bank’s loan to deposit ratio stood at 86%. As on 31st December 2021, the Bank’s reported Gross NPA and Net NPA levels were 3.17% and 0.91% respectively as against 3.53% and 1.08% as on 30th September 2021. Overall capital adequacy ratio (CAR) including profit for 9MFY22 stood at 18.72% with CET 1 ratio of 15.33%.
We have factored in CAGR 14% in advances, 14.7% in NII, 12.9% in PPOP, and 45.1% in PAT driven by healthy financial metrics on all fronts over FY21-24E. We maintain our target price of INR 936 per share, applying 2x FY24E P/ABV with an adjusted book value of INR 475. This implies an upside of 24.4% over the CMP. We maintain our rating on the share of AXSB at “BUY”
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At 16:00 hrs Axis Bank was quoting at Rs 803.95, up Rs 22.90, or 2.93 percent.
It has touched an intraday high of Rs 805.90 and an intraday low of Rs 787.75.
It was trading with volumes of 283,892 shares, compared to its thirty day average of 340,302 shares, a decrease of -16.58 percent.
In the previous trading session, the share closed up 1.03 percent or Rs 7.95 at Rs 781.05.
The share touched its 52-week high Rs 866.60 and 52-week low Rs 626.40 on 25 October, 2021 and 12 April, 2021, respectively.
Currently, it is trading 7.23 percent below its 52-week high and 28.34 percent above its 52-week low.
Market capitalisation stands at Rs 246,637.80 crore.