Axis Bank share price rises 6% buoyed by healthy Q4 numbers; should you buy, sell or hold? Here’s what experts say
Over the past year, Axis Bank's share price has marked a gain of approximately 28 per cent, outperforming the BSE Bankex index, which saw a more modest increase of 14 per cent, as well as the benchmark index Sensex, which has gained 24 per cent during the same period.
Axis Bank share price rose 6 per cent to end at ₹1127.35 apiece on BSE on Thursday, April 25, a day after the private lender reported a profit of ₹7,130 crore for Q4FY24 against a loss of ₹5,728.4 crore in the corresponding quarter last financial year.
Axis Bank Q4 result
After market hours on April 24, Axis Bank reported a net profit of ₹7,130 crore for Q4FY24. In the same quarter last year, the bank incurred a loss of ₹5,728.4 crore.
Axis Bank's net interest income (NII), the difference between interest earned and paid, rose 11.5 per cent year-on-year (YoY) to ₹13,089 crore against ₹11,742 crore in the year-ago period.
Axis Bank share price trend
Over the past year up to April 25, 2024, Axis Bank's share price has marked a gain of approximately 28 per cent, outperforming the BSE Bankex index, which saw a more modest increase of 14 per cent, as well as the benchmark index Sensex, which has gained 24 per cent during the same period.
Axis Bank share price hit its 52-week high of ₹1,151.50 on December 5 and its 52-week low of ₹853.75 on April 28 last year.
Should you buy, sell or hold?
Most brokerage firms expressed their positive views about the stock after Axis Bank's Q4 numbers. some of them revised their target prices upward while some said Axis Bank remains their top picks.
Brokerage firm Nirmal Bang has maintained a buy call on the stock with a target price of ₹1,255 against ₹1,256 earlier.
The brokerage firm has raised its FY25E and FY26E estimates by 5.8 per cent and 8.3 per cent, respectively after Axis Bank's Q4 results.
"We expect the bank to have an average ROA (return on assets) of 1.8% and ROE (return on equities) of 17 per cent over FY24-FY26E on the assumption of 15.2 per cent CAGR in loan growth, some compression in NIM in a declining interest rate environment, improving cost ratios and some upward normalization in credit costs," said Nirmal Bang.
Brokerage Prabhudas Lilladher also retained a buy call on the stock and raised the target price to ₹1,400 from ₹1,250 earlier.
"Axis Bank remains our top pick as NIM trajectory over FY24-26E is likely to be superior. With FY26E core RoA and RoE of 1.7 per cent and 16 per cent, respectively, the stock is trading at a 29 per cent discount to ICICI Bank, which should narrow. We maintain multiple at 2.2 times and but as we roll forward to Mar’26 ABV our target price increases to ₹1,400 from ₹1,250," said Prabhudas Lilladher.
Brokerage firm JM Financial also maintained its buy call on the stock with an unchanged target price of ₹1,330.
JM also said Axis Bank is one of its top picks as the brokerage firm believes it can re-rate further given sustained pick up in deposit growth while maintaining margin trajectory and asset quality. The brokerage firm expects an average ROA and ROE of 1.8 per cent and 17.2 per cent, respectively, over FY25-26E.
Choice Equity Broking has a buy call on the stock with a target price of ₹1,325 as it expects Axis Bank to see healthy profitability growth and stable return ratios in FY25 and FY26.
On the other hand, brokerage firm Motilal Oswal Financial Services retained its 'neutral' view on the stock with a revised target price of ₹1,200, citing the bank delivered a healthy earnings beat in Q4FY24, characterised by healthy other income and improvement in margins.
"We raise our estimates while remaining watchful over cost and a high CD ratio at 90 per cent. We estimate Axis Bank to deliver a 14.5 per cent CAGR in loans over FY24-26. Accordingly, we estimate FY26 RoA and RoE of 1.8 per cent and 16.8 per cent respectively," said Motilal Oswal.
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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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