Axis Bank's December quarter net profit is seen climbing 13 percent year-on-year to Rs 1517 crore, according to a CNBC-TV18 estimate based on a poll of analysts. Net interest income (difference between interest earned and interest paid out) for the quarter is seen rising 20 percent year-on-year to Rs 3006 crore.
Analysts are expecting around Rs 1,500 crore stressed assets per quarter for the remaining two quarters. The bank had earlier revised its stressed assets guidance from Rs 5,000 crore to Rs 6,000 crore.
According to CNBC-TV18 estimates, any further upward revision of stressed assets guidance will be a negative, which may lead to higher provisioning and lower profit rates.
Axis was one of the three private banks that benefitted from strong FCNR flows, hence improved liquidity (Axis USD 1.5 billion, HDFC Bank USD 3.4 billion, and ICICI Bank USD 2 billion).
The bank's restructured assets in Q2 stood at Rs 1,031 crore against Rs 690 crore in the first quarter and the slippages were at Rs 618 crore in Q2 against Rs 680 crore in Q1. Its provisioning coverage ratio is strong at 89 percent.
What to watch for
*Guidance on asset quality is factored in, hence it won't be surprising if it's line with expectations.
*Non-performing loans (NPL) addition is expected to be higher at Rs 800 crore against Rs 600 crore (Q-o-Q).
*PAT variation is expected to be higher with analysts expecting slower growth rate due to higher provisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
