Analysts expect credit cost to remain elevated, and said slippages will be a key monitorable to assess the impact of the second wave of Covid-19. They believe restructuring and ‘BB’ & below pool will be keenly watched.
ICICIdirect expects Axis Bank to report 151.2 per cent year-on-year rise in net profit at Rs 2,794 crore compared with Rs 1,112.20 crore reported for the year-ago quarter. Sequentially, it sees 4.4 per cent growth in profit. NII is seen rising 13.9 per cent YoY (5.3 per cent QoQ) to Rs 7,958 crore, led by 4 basis points expansion in NIM as the impact of interest reversals due to relief would not be seen.
“Loan growth for the bank is expected to come in at 10.5 per cent YoY while sequentially it is seen to be flat. Growth should be driven by retail segments such a home loans. Deposits are expected to rise 12 per cent YoY to Rs 7.03 lakh crore with steady Casa levels of 45 per cent. Credit cost should be elevated at 50 bps for the quarter with near-term asset quality, especially in MSME segment likely to see some deterioration,” the brokerage said. It expects gross NPAs to rise 10 basis points sequentially to 1.17 per cent.
Nirmal Bang sees profit climbing 159.7 per cent (7.9 per cent QoQ) to Rs 2,888 crore. It projects NII to rise 12 per cent to Rs 7,821 crore. Pre-provision profit is seen rising 13.8 per cent YoY to Rs 6,650.80 crore. NIM is seen flat at 3.4 per cent on both sequential and YoY basis.
Motilal Oswal expects profit to grow 95.2 per cent to Rs 2,171 crore on a 12.4 per cent rise in NII at Rs 7,852 crore. It expects the bank to show some moderation in business growth on a sequential basis.
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