Axis Bank Result Updated

8/2/2019 Axis Bank Result Updated

1/13

Please refer to important disclosures at the end of this report 1

Particulars (` cr) 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy)NII 2,146 2,140 0.3 1,701 26.2Pre-prov. profit 2,038 2,059 (1.1) 1,821 11.9

PAT 1,277 1,102 15.9 1,020 25.2Source: Company, Angel Research

For 4QFY2012, Axis Bank reported healthy 25.2% yoy growth in its net profit to

`1,277cr, above our as well as street estimates. Although the NIMs witnessed a

sequential decline of 20bp, higher recoveries and upgrades led to lower

provisioning expenses resulting in a healthy bottom-line.

NIMs decline on priority sector lending; higher recoveries improve NPA levels:The banks loan book grew by a healthy 19.2% yoy (up 14.1% qoq), while

deposits grew by 16.3% yoy (up 5.5% qoq). On a qoq basis, the growth in loan

book was primarily on account of higher agri lending (up 62.1% qoq) and SME

lending (up 15.0% qoq). Savings deposits growth was strong at 9.2% qoq (up a

healthy 26.5% yoy). On a daily average basis, saving account deposits grew by

20.2% yoy, while current account deposits increased by 28.9% yoy. The banks

reported NIM for the quarter declined by 20bp qoq on account of higher priority

sector lending (62.1% qoq growth) and lower investment yields. Fee income

picked up in 4QFY2012 on account of healthy loan growth in agri, SME and

retail segments. The slippages for the bank for 4QFY2012 remained at average

levels (`514cr compared to `535cr in 3QFY2012 and `496cr in 2QFY2012),

however sharp rise in recoveries and upgrades (`593cr compared to quarterly

average of `125cr since 1QFY2011), led to lower sequential gross NPA levels

(down 5.7% qoq) for the bank. Further, the bank improved its provisioning

coverage ratio to 81.0% from 75.8% in 3QFY2012, leading to significant decline

of 30.8% qoq in net NPA levels to`4,726cr.

Outlook and valuation: Axis Bank is trading at 1.5x FY2014E ABV 52% discountto HDFC Bank vs. an average discount of 32.9% since July 2006. We remain

positive on the bank, owing to its attractive CASA franchise, multiple sources of

sustainable fee income, strong growth outlook and A-list management. Wemaintain our Buy recommendation on the stock with a target price of `1,587.Key financialsY/E March (` cr) FY2011 FY2012 FY2013E FY2014ENII 6,563 8,018 9,807 11,982% chg 31.1 22.2 22.3 22.2

Net profit 3,388 4,242 4,969 5,939% chg 34.8 25.2 17.1 19.5

NIM (%) 3.2 3.1 3.2 3.2

EPS (`) 82.5 102.7 116.4 139.1P/E (x) 13.6 10.9 9.6 8.1P/ABV (x) 2.4 2.0 1.8 1.5

RoA (%) 1.6 1.6 1.6 1.5

RoE (%) 19.3 20.3 20.0 20.3

Source: Company, Angel Research

BUYCMP `1,121

Target Price `1,587

Investment Period 12 Months

Stock Info

Sector Banking

Market Cap (`cr) 46,306

Beta 1.2

52 Week High / Low 1367/785

Avg. Daily Volume 301,134

Face Value (`) 10

BSE Sensex 17,187

Nifty 5,209

Reuters Code AXBK.BO

Bloomberg Code AXSB@IN

Shareholding Pattern (%)

Promoters 37.4

MF / Banks / Indian Fls 13.4

FII / NRIs / OCBs 41.8

Indian Public / Others 7.5

Abs. (%) 3m 1yr 3yr

Sensex (0.3) (10.9) 56.2

Axis Bank 4.2 (16.0) 111.2

Vaibhav Agrawal022 3935 7800 Ext: 6808

[email protected]

Varun Varma022 3935 7800 Ext: 6847

[email protected]

Sourabh Taparia022 3935 7800 Ext: 6872

[email protected]

Axis BankPerformance Highlights

4QFY2012 Result Update | Banking

April 28, 2012


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Axis Bank | 4QFY2012 Result Update

April 28, 2012 2

Exhibit 1:4QFY2012 performance summaryParticulars (` cr) 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy)Interest earned 6,060 5,777 4.9 4,367 38.8- on Advances / Bills 4,258 3,964 7.4 3,063 39.0- on investments 1,738 1,775 (2.1) 1,213 43.2

- on balance with RBI & others 24 15 54.4 64 (62.4)

- on others 41 23 80.7 27 49.8

Interest Expended 3,914 3,637 7.6 2,666 46.8Net Interest Income 2,146 2,140 0.3 1,701 26.2Other income 1,588 1,430 11.0 1,450 9.5Other income excl. treasury 1,442 1,312 9.9 1,392 3.5

- Fee Income 1,327 1,223 8.5 1,231 7.8

- Treasury Income 146 118 24.1 58 151.8

- Others 115 90 28.2 161 (28.8)

Operating income 3,734 3,570 4.6 3,151 18.5Operating expenses 1,696 1,511 12.3 1,331 27.5- Employee expenses 530 542 (2.3) 396 33.7

- Other Opex 1,167 969 20.4 935 24.8

Pre-provision Profit 2,038 2,059 (1.1) 1,821 11.9Provisions & Contingencies 139 422 (67.0) 254 (45.2)- Provisions for NPAs 127 334 (62.0) 97 30.9

- Other Provisions 12 88 (86.1) 157 (92.2)

PBT 1,898 1,637 16.0 1,566 21.2Provision for Tax 621 535 16.2 546 13.7PAT 1,277 1,102 15.9 1,020 25.2


Exhibit 2:4QFY2012 Actual vs. Angel estimatesParticulars (` cr) Actual Estimates Var. (%)Net interest income 2,146 2,252 (4.7)

Other income 1,588 1,586 0.1

Operating income 3,734 3,838 (2.7)Operating expenses 1,696 1,602 5.9

Pre-prov. profit 2,038 2,236 (8.9)Provisions & cont. 139 521 (73.3)

PBT 1,898 1,715 10.7

Prov. for taxes 621 556 11.7

PAT 1,277 1,159 10.2Source: Company, Angel Research


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April 28, 2012 3

Exhibit 3:4QFY2012 performance analysisParticulars 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy)Balance sheetAdvances (`cr) 169,760 148,739 14.1 142,408 19.2Deposits (`cr) 220,104 208,693 5.5 189,238 16.3

Credit-to-Deposit Ratio (%) 77.1 71.3 586bp 75.3 187bp

Current deposits (`cr) 39,754 39,459 0.7 36,917 7.7

Saving deposits (`cr) 51,668 47,297 9.2 40,850 26.5

CASA deposits (`cr) 91,422 86,756 5.4 77,767 17.6

CASA ratio (%) 41.5 41.6 (4)bp 41.1 44bp

CAR (%) 13.7 11.8 188bp 12.7 101bp

Tier 1 CAR (%) 9.5 8.3 120bp 9.4 4bp

Profitability Ratios (%)Cost of funds 6.5 6.3 11bp 5.6 89bp

Reported NIM 3.6 3.8 (20)bp 3.4 11bp

Cost-to-income ratio 45.4 42.3 311bp 42.2 321bp

Asset qualityGross NPAs (`cr) 1,806 1,914 (5.7) 1,599 12.9

Gross NPAs (%) 0.9 1.1 (16)bp 1.0 (7)bp

Net NPAs (`cr) 473 683 (30.8) 410 15.2

Net NPAs (%) 0.3 0.4 (14)bp 0.3 (1)bp

Provision Coverage Ratio (%) 81.0 75.3 572bp 80.9 10bp

Slippage ratio (%) 1.4 1.5 (6)bp 1.0 49bp

NPA provision to avg. assets (%) 0.2 0.5 (33)bp 0.2 1bp


Balance sheet growth healthy

The banks loan book grew by a healthy 19.2% yoy (up 14.1% qoq), while deposits

grew by 16.3% yoy (up 5.5% qoq). On a qoq basis, the growth in loan book was

primarily on account of higher agri lending (up 62.1% qoq) and SME lending (up

15.0% qoq). The growth in retail portfolio was also strong at 12.9% qoq, driven by

strong growth in home loan advances.

Growth in the large and mid-corporate segment, though moderated from the

previous quarters, remained reasonably healthy at 5.9% qoq (19.2% yoy). Thebanks exposure to large and mid-corporate borrowers rated below-A had risen

from 27% in 2QFY2012 to 30% in 3QFY2012 and has further risen to 33% as of

4QFY2012.

The management has guided for a above sytem-average loan growth during

FY2013, with primary focus on retail lending (home ,auto and possibly unsecured

lending) and sme and agri lending (better opportunities and to meet priority sector

lending targets).


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April 28, 2012 4

Exhibit 4:Strong sequential growth in agri loansParticulars (` cr) 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy) % to totalCorporate 91,054 84,083 8.3 75,923 19.9 53.6

SME 23,796 20,692 15.0 21,406 11.2 14.0

Agri 17,340 10,700 62.1 17,320 0.1 10.2

Retail 37,570 33,264 12.9 27,759 35.3 22.1

- Housing 28,178 25,281 11.5 18,599 51.5 16.6

- Auto 4,884 4,324 12.9 3,053 60.0 2.9

- Others 4,508 3,659 23.2 6,107 (26.2) 2.7

Total advances 169,760 148,739 14.1 142,408 19.2 100.0Source: Company, Angel Research

Deposit accretion sustained the traction gained in 3QFY2012 into 4QFY2012 as

well, with rise of 5.5% qoq. Savings deposits growth was strong at 9.2% qoq (up a

healthy 26.5% yoy). On a daily average basis, saving account deposits grew by20.2% yoy, while current account deposits increased by 28.9% yoy. Period-end

CASA ratio remained largely steady around the 42% mark. The bank has been

focussing on building a stronger retail term deposits portfolio, as evident from the

43.1% yoy growth in this deposit franchise. As of 4QFY2012, retail term deposits

now constitute 37.2% ( 30.0% as of 4QFY2012) of total term deposits. The bank is

expected to continue focussing on building its retail franchise including low cost

deposits in FY2013 as well.

Exhibit 5:Average CASA growth picks up in 4QFY12


Exhibit 6:Period-end CASA ratio remains stable


NIMs decline on priority sector lending

The banks reported NIM for the quarter declined by 20bp qoq on account of

higher priority sector lending (62.1% qoq growth) and lower investment yields. The

banks yields on foreign loan book were higher by 25-50bp than average in

FY2012 on account of higher pricing power due to the tight liquidity environment

prevailing globally. However, the management expects these NIMs to decline back

to average levels of 1.0-1.2% in FY2013. The management has guided for overall

NIMs for 1QFY2013 to be in the band of 3.3-3.5%.

23

20 20

13

24

-

5

10

15

20

25

30

4QFY11 1QFY12 2QFY12 3QFY12 4QFY12

Reported yoy growth in average CASA balances (%)

41.140.5

42.2

41.6 41.5

37.0

39.0

41.0

43.0


(%)


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April 28, 2012 5

Exhibit 7:Cost of funds rise in 4QFY12...


Exhibit 8:...leading to 20bp dip in NIMs


Fee income picks up in 4QFY2012Fee income picked up in 4QFY2012 on account of healthy loan growth in agri,

SME and retail segments. Growth in agri and SME segment was strong at 77.3%

qoq, while fees from retail segment grew by 14.2% qoq, driven by 40.8% qoq

growth in third-party products. The treasury (including DCM) and trading profits

were also healthy for 4QFY2012 growing by 7.3% qoq and 24.1% qoq,

respectively.

The corporate based fee income for the bank has been sluggish in FY2012

(decline of 6.6% qoq and up only a muted 0.9% yoy), mostly due to weak macro

environment which has slowed down corporate activities. The management expectsthe corporate fee income to remain subdued in FY2013 as well and see growth

picking up only post further easing of macro headwinds. The management has

however guided for fee income in line with balance sheet growth in FY2013,

driven by higher fee income from retail and SME segments.

Exhibit 9:Fee income up sequentially on back of healthy qoq loan growthParticulars (` cr) 4QFY12 3QFY12 % chg (qoq) 4QFY11 % chg (yoy)Fee Income 1,327 1,223 8.5 1,231 7.8Corporate 442 473 (6.6) 438 0.9

Treasury 249 232 7.3 255 (2.4)

Agri & SME 117 66 77.3 100 17.0Business banking 128 109 17.4 107 19.6

Capital markets 13 13 - 19 (31.6)

Retail 377 330 14.2 312 20.8

- Third-Party Products 138 98 40.8 103 34.0

- Cards, Retail Forex & Remittance 117 111 5.4 85 37.6

- Other Retail 122 121 0.8 124 (1.6)

Trading profit 146 118 24.1 58 151.8

Others 115 90 28.2 161 (28.8)

Other income 1,588 1,430 11.0 1,450 9.5Other income excl. Treasury 1,442 1,312 9.9 1,392 3.5


5.566.13 6.19

6.34 6.45

3.5

4.5

5.5

6.5


(%)

3.44

3.28

3.78 3.75

3.55

2.7

3.0

3.3

3.6

3.9


(%)


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April 28, 2012 6

Higher recoveries and upgrades lead to qoq decline in NPA

levels

The bank surprised positively on asset quality with provision expenses declining by

45.2% yoy (down 67.0% qoq) to`139cr.The bank reversed provisions of `102cr

(made on account of investment depreciation) during the quarter.

The slippages for the bank for 4QFY2012 remained at average levels (`514cr

compared to`535cr in 3QFY2012 and`496cr in 2QFY2012), however sharp rise

in recoveries and upgrades (`593cr compared to quarterly average of `125cr

since 1QFY2011), led to lower sequential gross NPA levels (down 5.7% qoq) for

the bank. Further, the bank improved its provisioning coverage ratio to 81.0%

from 75.8% in 3QFY2012, leading to significant decline of 30.8% qoq in net NPA

levels to`4,726cr.

The bank restructured loans worth ~`588cr, higher than the `295cr restructuredduring 3QFY2012. The outstanding restructured book as 4QFY2012 for the bank

stands at`3,060cr.

Exhibit 10:Slippages remain stable sequentially


Exhibit 11:NPA levels decline sequentially

Source: Company, Angel Research; Note: PCR including tech. write-offs

Exhibit 12:Network expansion continues steadily

Source: Company, Angel Research;

Exhibit 13:Cost-to-income ratio rises above 45%


0.950.83

1.391.50 1.44

-

0.40

0.80

1.20

1.60


(%)

1.0

1.1

1.1

1.1

0.9

0.3

0.3

0.3

0.4

0.3

80.9 80.077.7

75.3

81.0

55.0

62.5

70.0

77.5

85.0

-

0.3

0.5

0.8

1.0

1.3


Gross NPAs (%) Net NPAs (%) NPA coverage (%, RHS)

1,3

90

1,4

11

1,4

46

1,4

93

1,6

22

6,270 6,871

7,594 8,3249,924

-

2,500

5,000

7,500

10,000

12,500

400

800

1,200

1,600

2,000


Branches ATMs (RHS)

2.4 2.2 2.4 2.3 2.4

42.2

46.1

45.2

42.3

45.4

38.0

41.0

44.0

47.0

2.0

2.1

2.2

2.3

2.4

2.5


Opex to avg. assets (%) CIR (%, RHS)


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April 28, 2012 7

Capital adequacy comfortable for now

The banks capital adequacy as of 4QFY2012 stands at a comfortable 13.7% with

tier-I ratio of 9.5%. The bank is not looking at any immediate capital raising plans

and would assess the need for capital requirements in the latter half of the year.

Investment arguments

Branch expansion to support faster market share gains

We believe Axis Banks reasonable capital adequacy positions it for market share

gains with ~500bp higher growth than industry over FY201214. The bank has

expanded its network at a 31.6% CAGR since FY200312, driving a four-fold

increase in its CASA market share to 4.3% by FY2011. In our view, such gains will

continue going forward as well, especially as network expansion (250+ additions,

about 2025% yoy) remains strong.

Fee income continues to drive higher RoEs

Axis Banks fee income contribution across a spectrum of services has been a

meaningful 1.9-2.0% of assets (almost twice the level in PSBs) over FY200912.

Going forward, fee income growth is likely to at least mirror balance sheet growth.

We have built in a 20.2% CAGR over FY201214) in fee income, leading to

sustained contribution of 1.9% of assets for FY2013 and FY2014.

Book-accretive dilution on the cards in the next 1218 months

Axis Bank's tier-I capital adequacy has dipped to 9.5% as of FY2012 from 11.2%

in FY2010 due to strong credit growth. Going forward also, we expect

management to meet its guidance for healthy growth of ~1.3x the industrys

growth. This is likely to result in a need to raise capital in the next

1218 months, as per our calculations. (Axis Bank had last raised capital in

2QFY2010 when its tier-I CAR was 9.4%). Dilution is likely to be book-accretive

and will aid in further enhancing the bank's credit market share going forward.

Outlook and valuation

Axis Banks aggressive branch expansion (at a CAGR of ~30%) over FY200812 is

expected to lead to further CASA market share gains for the bank. In FY2011, the

bank added over 400 branches (an increase of 41.4% yoy), while in FY2012 the

bank added 232 (an increase of 16.7% yoy) branches. These branches are

expected to contribute more meaningfully in FY2013 and FY2014 and aid in

driving business and profitability growth for the bank.

Axis Bank is trading at 1.5x FY2014E ABV 52% discount to HDFC Bank vs. an

average discount of 32.9% since July 2006. We remain positive on the bank,

owing to its attractive CASA franchise, multiple sources of sustainable fee income,

strong growth outlook and A-list management. We maintain our Buyrecommendation on the stock with a target price of `1,587.


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April 28, 2012 8

Exhibit 14:Key assumptionsParticulars (%) Earlier estimates Revised estimatesFY2013 FY2014 FY2013 FY2014Credit growth 22.0 23.0 22.0 23.0Deposit growth 20.0 23.0 23.0 23.0

CASA ratio 40.8 40.8 40.8 40.8

NIMs 3.1 3.1 3.2 3.2

Other income growth 17.1 18.6 17.1 19.3

Growth in staff expenses 22.0 24.0 22.0 24.0

Growth in other expenses 22.0 24.0 22.0 24.0

Slippages 2.2 2.2 1.6 1.5

Coverage ratio 73.6 76.2 80.8 80.4

Source: Angel Research

Exhibit 15:Change in estimatesParticulars (` cr) FY2013 FY2014Earlierestimates Revisedestimates Var. (%) Earlierestimates Revisedestimates Var. (%)NII 9,812 9,807 (0.0) 11,752 11,982 2.0

Non-interest income 6,347 6,349 0.0 7,525 7,574 0.7

Operating income 16,159 16,157 (0.0) 19,277 19,557 1.4Operating expenses 7,214 7,329 1.6 8,945 9,088 1.6

Pre-prov. profit 8,945 8,828 (1.3) 10,332 10,469 1.3Provisions & cont. 1,792 1,473 (17.8) 1,766 1,678 (5.0)

PBT 7,154 7,355 2.8 8,566 8,791 2.6Prov. for taxes 2,321 2,386 2.8 2,779 2,852 2.6

PAT 4,833 4,969 2.8 5,787 5,939 2.6Source: Angel Research

Exhibit 16:Angel EPS forecast vs. consensusYear (`) Angel forecast Bloomberg consensus Var. (%)FY2013E 116.4 116.0 0.3

FY2014E 139.1 139.6 (0.4)

Source: Bloomberg, Angel Research


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April 28, 2012 9

Exhibit 17:P/ABV band


Exhibit 18:Discount to HDFC Bank (%)


(300)

100

500

900

1,300

1,700

2,100

2,500

Apr-

06

Nov-0

6

Jun-0

7

Jan-0

8

Aug-0

8

Mar-

09

Oct-09

May-1

0

Dec-1

0

Jul-11

Fe

b-1

2

Sep-1

2

Price (`) 0.8x 1.4x 2x 2.6x 3.2x

(60.0)

(45.0)

(30.0)

(15.0)

-

Aug-

06

Dec-

06

Apr-07

Aug-

07

Dec-

07

Apr-08

Aug-

08

Dec-

08

Apr-09

Aug-

09

Dec-

09

Apr-10

Aug-

10

Dec-

10

Apr-11

Aug-

11

Dec-

11

Apr-12

(%)


10/13


April 28, 2012 10

Exhibit 19:Recommendation summaryCompany Reco. CMP(`) Tgt. price(`) Upside(%) FY2014EP/ABV (x) FY2014ETgt P/ABV (x) FY2014EP/E (x) FY2011-14EEPS CAGR (%) FY2014ERoA (%) FY2014ERoE (%)AxisBk Buy 1,121 1,587 41.6 1.5 2.2 8.1 16.4 1.5 20.3FedBk Neutral 417 - - 1.0 - 7.3 13.0 1.3 14.5

HDFCBk Neutral 543 - - 3.1 - 15.3 27.0 1.7 22.1

ICICIBk* Buy 869 1,183 36.1 1.4 1.9 10.7 20.4 1.5 16.0

SIB Neutral 24 - - 1.0 - 6.0 6.7 0.9 17.7

YesBk Buy 350 470 34.3 1.8 2.4 8.4 22.5 1.4 23.3

AllBk Buy 165 205 24.9 0.6 0.8 4.0 (2.1) 1.0 17.0

AndhBk Accumulate 115 125 8.6 0.7 0.8 4.3 6.5 1.0 16.7

BOB Buy 764 943 23.4 0.9 1.1 5.0 12.2 1.1 19.2

BOI Buy 337 392 16.2 0.9 1.0 5.2 21.3 0.8 16.5

BOM Buy 51 62 21.0 0.6 0.8 3.8 26.8 0.9 17.5

CanBk Buy 430 532 23.6 0.7 0.9 4.5 10.9 0.9 16.7CentBk Neutral 95 - - 0.8 - 4.8 45.7 0.5 13.8

CorpBk Buy 410 508 23.9 0.6 0.7 3.7 2.5 0.8 16.2

DenaBk Buy 91 118 29.6 0.6 0.7 3.6 6.2 0.9 16.9

IDBI# Buy 101 117 15.2 0.6 0.7 4.2 22.7 0.9 14.8

IndBk Accumulate 213 240 12.8 0.7 0.8 4.4 5.4 1.2 18.2

IOB Buy 87 104 19.8 0.5 0.7 4.1 29.9 0.6 13.9

J&KBk Neutral 895 - - 0.8 - 4.6 8.8 1.4 18.6

OBC Buy 242 296 22.7 0.5 0.7 4.0 17.1 0.8 13.6

PNB Buy 839 1,138 35.6 0.8 1.1 4.7 8.8 1.1 18.5

SBI* Buy 2,131 2,593 21.7 1.3 1.6 7.9 23.6 1.0 19.1

SynBk Buy 101 128 26.9 0.6 0.8 3.7 8.7 0.8 17.2

UcoBk Neutral 76 - - 0.7 - 4.0 7.7 0.7 16.2

UnionBk Buy 219 266 21.5 0.7 0.9 4.4 27.2 0.8 17.4

UtdBk Buy 65 87 33.9 0.5 0.7 3.0 11.4 0.7 16.0

VijBk Neutral 57 - - 0.7 - 4.9 14.2 0.5 13.2

Source: Company, Angel Research; Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries), #Without adjusting for SASF


11/13


April 28, 2012 11

Income statement

Y/E March (` cr) FY08 FY09 FY10 FY11 FY12 FY13E FY14ENet Interest Income 2,585 3,686 5,004 6,563 8,018 9,807 11,982- YoY Growth (%) 65.0 42.6 35.8 31.1 22.2 22.3 22.2Other Income 1,795 2,834 3,946 4,632 5,420 6,349 7,574- YoY Growth (%) 77.7 57.8 39.2 17.4 17.0 17.1 19.3

Operating Income 4,381 6,520 8,950 11,195 13,438 16,157 19,557- YoY Growth (%) 70.0 48.8 37.3 25.1 20.0 20.2 21.0

Operating Expenses 2,155 2,858 3,710 4,779 6,007 7,329 9,088- YoY Growth (%) 77.4 32.6 29.8 28.8 25.7 22.0 24.0

Pre - Provision Profit 2,226 3,662 5,241 6,416 7,431 8,828 10,469- YoY Growth (%) 63.4 64.5 43.1 22.4 15.8 18.8 18.6

Prov. & Cont. 579 877 1,389 1,280 1,143 1,473 1,678- YoY Growth (%) 58.2 51.3 58.5 (7.9) (10.7) 28.8 13.9

Profit Before Tax 1,646 2,785 3,851 5,136 6,288 7,355 8,791- YoY Growth (%) 65.3 69.2 38.3 33.3 22.4 17.0 19.5

Prov. for Taxation 575 970 1,337 1,747 2,046 2,386 2,852- as a % of PBT 35.0 34.8 34.7 34.0 32.5 32.4 32.4

PAT 1,071 1,815 2,515 3,388 4,242 4,969 5,939- YoY Growth (%) 62.5 69.5 38.5 34.8 25.2 17.1 19.5

Balance sheetY/E March (` cr) FY08 FY09 FY10 FY11 FY12 FY13E FY14EShare Capital 358 359 405 411 413 427 427Reserve & Surplus 8,411 9,855 15,639 18,588 22,395 26,509 31,083

Deposits 87,626 117,374 141,300 189,238 220,104 270,728 332,996

- Growth (%) 49.1 33.9 20.4 33.9 16.3 23.0 23.0

Borrowings 5,624 10,185 10,014 19,275 22,683 27,791 34,029

Tier 2 Capital 3,429 5,334 7,156 6,993 11,389 13,895 17,090

Other Liab. & Prov. 4,130 4,613 6,134 8,209 8,643 10,609 12,886

Total Liabilities 109,578 147,721 180,648 242,713 285,628 349,960 428,512Cash Balances 7,306 9,419 9,482 13,886 10,703 10,829 13,320

Bank Balances 5,199 5,598 5,722 7,522 3,231 3,959 4,847

Investments 33,705 46,330 55,975 71,992 93,192 117,437 142,688

Advances 59,661 81,557 104,341 142,408 169,760 207,107 254,741

- Growth (%) 61.8 36.7 27.9 36.5 19.2 22.0 23.0

Fixed Assets 923 1,073 1,222 2,273 2,259 2,685 3,189

Other Assets 2,785 3,744 3,906 4,632 6,483 7,943 9,726

Total Assets 109,578 147,721 180,648 242,713 285,628 349,960 428,512- Growth (%) 49.6 34.8 22.3 34.4 17.7 22.5 22.4


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Ratio analysis

Y/E March FY08 FY09 FY10 FY11 FY12 FY13E FY14EProfitability ratios (%)NIMs 2.9 3.0 3.1 3.2 3.1 3.2 3.2Cost to Income Ratio 49.2 43.8 41.4 42.7 44.7 45.4 46.5

RoA 1.2 1.4 1.5 1.6 1.6 1.6 1.5

RoE 17.6 19.1 19.2 19.3 20.3 20.0 20.3

B/S ratios (%)CASA Ratio 45.7 43.1 46.7 41.1 41.5 40.8 40.8

Credit/Deposit Ratio 68.1 69.5 73.8 75.3 77.1 76.5 76.5

CAR 13.7 13.7 15.8 12.7 14.3 14.1 13.8

- Tier I 10.2 9.3 11.2 9.4 9.6 9.3 8.9

Asset Quality (%)Gross NPAs 0.8 1.1 1.3 1.1 1.1 0.9 0.7

Net NPAs 0.4 0.4 0.4 0.3 0.3 0.2 0.1

Slippages 1.0 1.5 2.2 1.4 1.3 1.6 1.5

Loan Loss Prov. /Avg. Assets 0.4 0.6 0.8 0.5 0.3 0.4 0.3

Provision Coverage 49.8 63.6 68.2 74.3 73.8 80.8 80.4

Per Share Data (`)EPS 29.9 50.6 62.1 82.5 102.7 116.4 139.1

ABVPS (75% cover.) 241.6 281.6 393.8 462.5 551.5 630.8 738.0

DPS 6.0 10.0 12.0 14.0 16.0 23.0 27.5

Valuation RatiosPER (x) 37.4 22.2 18.1 13.6 10.9 9.6 8.1

P/ABVPS (x) 4.6 4.0 2.8 2.4 2.0 1.8 1.5

Dividend Yield 0.5 0.9 1.1 1.2 1.4 2.1 2.5

DuPont AnalysisNII 2.8 2.9 3.0 3.1 3.0 3.1 3.1

(-) Prov. Exp. 0.6 0.7 0.8 0.6 0.4 0.5 0.4

Adj. NII 2.2 2.2 2.2 2.5 2.6 2.6 2.6

Treasury 0.2 0.2 0.4 0.2 0.1 0.1 0.1

Int. Sens. Inc. 2.4 2.4 2.7 2.7 2.7 2.7 2.7

Other Inc. 1.7 2.0 2.0 2.0 1.9 1.9 1.9

Op. Inc. 4.2 4.4 4.6 4.7 4.7 4.6 4.6

Opex 2.4 2.2 2.3 2.3 2.3 2.3 2.3PBT 1.8 2.2 2.3 2.4 2.4 2.3 2.3

Taxes 0.6 0.8 0.8 0.8 0.8 0.8 0.7

RoA 1.2 1.4 1.5 1.6 1.6 1.6 1.5Leverage 15.0 13.6 12.5 12.1 12.6 12.8 13.3

RoE 17.6 19.1 19.2 19.3 20.3 20.0 20.3


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Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com

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Axis Bank Result Updated