Buy Axis Bank; target of Rs 1130: HDFC Securities

HDFC Securities is bullish on Axis Bank has recommended buy rating on the stock with a target price of Rs 1130 in its research report dated April 27, 2023.

Broker Research

April 29, 2023 / 10:23 IST

Buy

26 Aug, 2025 12:21

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HDFC Securities' research report on Axis Bank

Axis Bank (AXSB) reported a one-time loss from accounting for its merger with Citi Bank’s India consumer business, ex of which it delivered a beat, led by strong loan growth (+16% YoY standalone), healthy fee income and lower credit costs (22bps annualised). NIMs moderated marginally (-4bps QoQ) on account of excess liquidity on the balance sheet (LCR at 129%) and catch-up in funding costs following accelerated deposit mobilisation. That said, the loan-to-deposit ratio (~89%) continues to remain high and we believe AXSB will have to further accelerate efforts to match its targeted loan growth (management has guided for loan growth of 400-600bps above industry), which is likely to impede medium term NIMs.

Outlook

We tweak our FY24/FY25E earnings estimates by +3% each to adjust for normalised credit costs and higher opex on continued investments in growth. Maintain BUY with a revised SOTP-based target price of INR1,130 (standalone bank at 2.0x Mar-25 ABVPS).

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