Axis Bank shares surge 6% after strong Q3 results, net profit grows 224% YoY

Axis Bank shares jumped over 6%
to Rs 720 on the BSE in Tuesday’s session after the company reported a 224%
jump in standalone net profit at Rs 3,614 for the quarter ending December 31,
2021. Due to strong growth in deposits and loans and improving asset
quality, the lender’s net profit jumped nearly three-fold from Rs 1,117 crore
in the year-ago period.

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The bank’s core net interest
income (NII) grew 17% YoY to Rs 8,653 crore on a 17% loan growth. Net interest
margin (NIM) for the quarter improved by 14 basis points (bps) to 3.53%.

Interest earned jumped to Rs
17,261 crore from to Rs 15,426 crore in the corresponding period a year ago.
There was a significant drop in provisions and contingencies to Rs 1,335 crore
as against Rs 3,757 crore a year ago. The over Rs 5,000 crore in excess
provisions for COVID were untouched, the bank said in its regulatory filing.

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The lender’s gross
non-performing asset (NPA) ratio improved at 3.17% during the quarter. The net
NPA ratio was at 0.91%, as compared to 1.08% in the second quarter.

Total deposits increased by 22%
YoY on a quarterly average balance (QAB) basis. The bank reported 18%
year-on-year growth in retail loans, 20% growth in SME loans and 13% growth in
the corporate loan book.

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According to a regulatory filing,
Axis Bank’s total deposits increased 20% year-on-year to Rs 7.7 lakh crore with
current account-savings deposits risings by 22% year-on-year. The lender’s CASA
ratio improved 189 basis points on-year to 44%.

Overall capital adequacy ratio
(CAR), including profit for the first nine months of the current financial
year, stood at 18.72% with a common equity tier-1 ratio of 15.33%.

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Operating profit grew 17% YoY
to Rs 6,162 crore while core operating profit rose 9%. Core operating profit
excludes trading profit and gain or loss on capital repatriated from overseas
branches or subsidiaries.

Total income rose to over Rs
21,101 crore from Rs 18,355 crore in the same quarter of 2020-21.

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Amitabh Chaudhry, managing
director and chief executive officer of Axis Bank, said, “We are
optimistic about the future and plan to leverage every sustainable growth
opportunity that is available to us.”