Ranvir’s Portfolio

Axis Bank Q4 concall highlights –

Excluding exceptional items ( Acquisition of Citi Banks India business ) –

PAT at 6625 cr, up 61 pc yoy
RoA – 2.18 pc, consol
RoE – 21.5 pc, consol !!!

Operating performance (yoy)-

NII up 33 pc
Fee inc up 24 pc
Op profits up 42 pc

Advances up 19 pc ( including Citibank’s loans )-
Domestic –

Retail advances up 22 pc – of which Rural up 26 pc, Cards up 97 pc
Corporate advances up 24 pc, Mid corporates up 38 pc, SME up 23 pc
Small Business Banking advances up 50 pc

Overseas advances lagging domestic growth

Deposits up 15 pc ( including Citibank’s deposits )-

CA up 17 pc
SA up 23 pc
Term deposits up 11 pc

GNPAs at 2.02 vs 2.82 pc yoy
NNPAs at 0.39 vs 0.73 pc yoy
Annualised gross slippages at 1.76 pc ( within guided range )

PAT from subsidiaries for FY 23 at 1304 cr, up 9 pc

Excluding acquisition impact, Annual EPS at Rs 86/share

Including acquisition impact, Book Value at 406

CASA deposits at 47 pc of total, up 21 pc yoy

Advances Domestic breakup –

Retail 58 pc, up 22 pc
SME 11 pc, up 23 pc
Corporate 31 pc, up 24 pc

NIMs at 4.02 pc, up 55 bps

PCR at 80 pc. Including specific + std+ addnl + COVID provisions – at 145 pc of GNPAs (very healthy)

Management commentary –

Among the largest issuer of credit cards in FY 23 at 4.2 million

New accounts opened in FY 23 at 1.08 cr, up 26 pc yoy

Cost/Inc at 46.1 pc, improving by 274 bps ( for FY 23 )

Added 6000 ppl to growth businesses and Technology teams in Q4

Lower credit costs allowing bank to invest in ppl and tech

Guidance for FY 24 –
Advances growth between 16-18 pc
Deposit growth between 14-15 pc

Expect to add upto 500 branches in FY 24

Next yr, Opex is likely to be higher due Citibank’s acquisition which is largely a retail business. By FY 25, want to come back to 2 pc of assets as Opex cost

Corporates/wholesale and Mortgage loans – remain very competitive wrt yeilds

Some easing in competition witnessed on corporate/wholesale side

Recoveries and upgrades trend has been good because the quality of Bank’s book has structurally improved. Bank has made a lot of efforts to reach here

Expect uplift in growth due Citi’s acquisition from Q2 onwards

All one time costs wrt Citi’s merger have been absorbed. 1500 cr of operating costs will be absorbed over next 18 months

Also seeing pickup in Corporate demand across various sectors like – steel, infra, RE etc

Disc : holding, biased