Axis Bank has reported a 3.83% rise in net profit for the third quarter of FY25, reaching Rs 6,304 crore. While this marks a year-on-year (YoY) increase, it falls short of analysts’ expectations. The bank’s profit was lower sequentially, with a 9% drop compared to the previous quarter’s Rs 6,917 crore. For Q3 FY25, Axis Bank’s interest income grew by 11%, reaching Rs 30,954 crore, up from Rs 27,961 crore in the same period last year. This growth was supported by moderate loan growth, which increased by 9% YoY. However, […]
Axis Bank
Axis Bank has reported a 3.83% rise in net profit for the third quarter of FY25, reaching Rs 6,304 crore. While this marks a year-on-year (YoY) increase, it falls short of analysts’ expectations. The bank’s profit was lower sequentially, with a 9% drop compared to the previous quarter’s Rs 6,917 crore.
For Q3 FY25, Axis Bank’s interest income grew by 11%, reaching Rs 30,954 crore, up from Rs 27,961 crore in the same period last year. This growth was supported by moderate loan growth, which increased by 9% YoY. However, this growth was slower than the previous quarter’s 11% rise. Total deposits also grew by 9% during this period.
Despite the positive growth in interest income, the net interest margin (NIM) narrowed to 3.93% from 4.01% in Q3 FY24 and 3.99% in the previous quarter. NIM is a key measure of profitability for banks.
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The bank’s provisions and contingencies more than doubled YoY to Rs 2,156 crore. This increase reflects the challenges faced by Indian lenders due to rising bad loans in sectors like microfinance and unsecured lending.
Axis Bank’s gross non-performing asset (NPA) ratio stood at 1.46% as of December 2024, slightly up from 1.44% in the previous quarter. This signals a marginal deterioration in asset quality, which is a concern for banks in the current economic environment.
Amitabh Chaudhry, the bank’s Managing Director & CEO, expressed optimism about the bank’s prospects. He stated, “We closed 2024 on a high, firming up our businesses and capabilities. Our growth drivers have been digital expansion, rural presence, and a focus on sustainability and inclusivity.” Chaudhry emphasized that the bank is well-positioned to tap into the opportunities of 2025 as India progresses towards becoming the third-largest global economy in the near future.
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In summary, Axis Bank’s Q3 results show solid YoY growth in net profit and interest income. However, higher provisions for bad loans and a slight dip in asset quality have limited the bank’s profitability. While the bank’s business drivers such as digital and rural initiatives remain strong, challenges related to rising NPAs and narrower NIMs could affect its future growth trajectory. Investors and analysts will closely monitor how the bank navigates these headwinds in the coming quarters.
