Axis Bank FY25 Annual Earnings Summary
4 quarters covered · ₹0 Cr revenue · ₹28,191 Cr PAT · 0.0% average EBITDA margin.
Quarter-by-quarter progression
Management promises made during the year
The current-quarter record did not contain enough evidence of delivery; the item remains delayed for follow-up.
Q1 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q3 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY25Risks flagged during the year
Retail slippages increased 40-45 bps YoY, primarily from unsecured products, and may persist in near term.
Q3 FY25 · highRetail slippages, largely from unsecured products, have increased 40-45 bps YoY. Management expects corrective actions to help but does not call a peak.
Q1 FY25 · mediumCredit costs in retail unsecured portfolios are rising, though still within internal risk benchmarks. Further deterioration could pressure earnings.
Q1 FY25 · mediumManagement flagged deposit growth as a key constraint for loan growth in the near term, which could limit balance sheet expansion.
Q1 FY25 · medium55% of the increase in net credit cost was due to lower recoveries and upgrades in the wholesale segment, which are episodic and may not materialize as expected.
Q2 FY25 · mediumRBI draft circular on overlapping businesses may affect subsidiaries; management is evaluating implications.
Q2 FY25 · mediumNew LCR draft norms could reduce reported LCR from 115% closer to 100%, requiring balance sheet adjustments.
Q3 FY25 · mediumRBI draft circular restricts subsidiaries from doing overlapping business. Bank is evaluating implications; uncertainty remains.
Q3 FY25 · mediumCurrent LCR of 115% may fall closer to 100% under proposed norms. Bank has tools but final guidelines are awaited.
Q4 FY25 · mediumManagement noted that personal loan delinquencies may take a few more quarters to stabilize, despite early positive signals from underwriting changes.
Q4 FY25 · mediumWith repo-linked loans repricing faster than deposits, NIMs could face pressure in a rate cut cycle, though management expects to offset via mix and savings rate cuts.
Q4 FY25 · mediumThe bank incurred INR 591 crore in PSLC purchase costs in Q4 to meet PSL shortfalls, and similar costs may recur in FY26 due to MFI and Gold Loan classification issues.
What changed through the year
Q1 FY25 · Advances growth 300-400 bps above industry
Management expects advances to grow 300-400 basis points faster than industry over the medium to long term, contingent on deposit availability.
Q1 FY25 · Credit cost not indicative of full year
Q1 annualized net credit cost of 0.97% is not reflective of full-year expectations due to timing differences in recoveries.
Q1 FY25 · Operating expense growth moderation
Expense growth will moderate through FY25 from the 27-29% YoY range seen last year.
Q2 FY25 · Medium-term loan growth 300-400 bps above industry
Management reiterated that advances can grow 300 to 400 basis points faster than industry in the medium to long term.
Q2 FY25 · Deposit growth to remain a key constraint in short term
Given regulatory focus on CD ratio, deposit growth will be a key constraint for advances growth in the short to medium term.
Q2 FY25 · Cost growth moderation to continue
Management expects pace of cost growth to moderate, having delivered 9% YoY growth in Q2.
Q3 FY25 · Medium-term loan growth 300-400 bps above industry
Management expects advances to grow 300-400 basis points faster than industry in the medium to long term, driven by focus segments.
Q3 FY25 · Deposit growth to remain a key constraint in short term
Deposit growth will be a key constraint for advances growth in the short to medium term, given regulatory focus on CD ratio.
Q3 FY25 · No need for equity capital; may issue Tier 2/AT1
Bank does not need equity capital for growth or protection; may opportunistically evaluate Tier 2 and AT1 instruments.
Q4 FY25 · FY26 credit cost may be marginally higher than FY25
Due to tightened classification norms for certain accounts (e.g., OTS), slippages in FY26 could be marginally higher than FY25.
Q4 FY25 · Personal loan portfolio to stabilize in a few quarters
Underwriting corrections on personal loans are showing early positive reads, but full stabilization will take a few more quarters.
Q4 FY25 · NIM cushion of ~18 bps above through-cycle guidance
Management aims to retain as much of the 18 bps cushion above the through-cycle NIM of 3.8% as possible, using mix and repricing levers.