Systematix highlighted that Axis Bank’s steady loan growth, improving profitability, disciplined credit costs, and deposit traction continue to support a constructive medium‑term outlook.

Axis Bank Ltd. delivered a strong performance in Q3 FY26 with a PAT of Rs 6,490 Crore, up 27.5% QoQ and 2.9% YoY, coming in 3.7% above Systematix’s estimates. The sequential improvement was driven by higher net interest income, lower operating expenses, and reduced provisions, contributing to a solid quarter.

The bank reported advances growth of 3.8% QoQ (14.2% YoY), with management reiterating its medium‑term aspiration to grow 300 bps above industry levels. Deposits increased 4.8% QoQ and 15% YoY, comfortably outpacing loan growth, supported by robust term‑deposit accretion.

Axis Bank’s NIM for Q3 stood at 3.64%, declining 9bps sequentially and 29bps YoY. The management attributed 1bp of the sequential decline to seasonal interest reversals, and the remaining 8bps to lower spreads due to a growing share of wholesale advances.

Despite the near‑term compression, the bank reiterated confidence in maintaining through‑cycle NIMs of around 3.8%.

With valuations rolled forward to FY28E, Systematix has raised its target price to Rs 1,590 (from Rs 1,475 earlier) and maintains a Buy rating. The standalone bank is valued at 1.6x FY28E book value per share of Rs 882, while an additional Rs 177 per share is ascribed to its subsidiaries and associates.

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Axis Bank Q3 Review: Improving Internals, Loan Growth Pickup Boost Re-Rating Hopes

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