Axis Bank tanks 6% post Q3 earnings; brokerage maintains 'buy'
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Shares of Axis Bank tanked over 6% after the private lender reported a whopping 73% decline in net profit at Rs 580 crore in the December quarter on account of rise in bad loans.
It had reported net profit of Rs 2,175 crore in the same quarter of last fiscal year.
Axis Bank's portfolio quality deteriorated, with gross non-performing assets (NPAs) rising to 5.22% of gross advances as against 1.68% in the same quarter of the previous fiscal year.
Its net non-performing assets also jumped to 2.18%, from the earlier 0.75%.
Reacting to its quarterly earnings, the stock slipped as much as 6.54 to Rs 452 on the BSE.
However, brokerage Angel Broking maintained 'buy' rating on the stock, saying any knee-jerk reaction to the stock should be treated as a buying opportunity.
“Axis Bank’s results for the quarter were below expectations on account of higher provisions. However, the good part is that slippages for the quarter remained lower on quarterly basis and the overall watch-list got reduced," said brokerage Angel Broking in a research note.
"We believe though the next two quarters could be challenging for the bank, a lot of this seems priced in now and we may not see sharp corrections in the stock price," it added.
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