Axis Bank Management Guidance Tracker

Management expects Axis Bank to grow loans at 400-600 basis points faster than the banking system credit growth of ~13% for FY24.

Digital banking platform Open currently ~5% of bank's business; management intends to increase contribution 3-4 times by fiscal 2027.

Management expects system credit growth to moderate towards deposit growth of around 13% due to tight liquidity.

Axis Bank maintains its medium-term guidance of growing loans 4-6 percentage points faster than the industry, though not on a quarter-to-quarter basis.

Management expects to grow advances 300-400 basis points faster than the industry over the medium to long term (3-5 years).

Management expects system credit growth to converge towards deposit growth of around 13% for the fiscal year.

Management expects advances to grow 300-400 basis points faster than industry over the medium to long term, contingent on deposit availability.

Management reiterated that advances can grow 300 to 400 basis points faster than industry in the medium to long term.

Given regulatory focus on CD ratio, deposit growth will be a key constraint for advances growth in the short to medium term.

Management expects advances to grow 300-400 basis points faster than industry in the medium to long term, driven by focus segments.

Deposit growth will be a key constraint for advances growth in the short to medium term, given regulatory focus on CD ratio.

Underwriting corrections on personal loans are showing early positive reads, but full stabilization will take a few more quarters.

Management expects the bank's loan growth to outpace industry average by 300 basis points in the medium term (3-5 years with FY26 as base).

Over 3-5 years with FY26 as base, advances are expected to grow 300 bps faster than industry.

CEO expects deposit growth to stabilize at similar levels as credit growth within 15-18 months, aided by sustained liquidity infusion.

Management expects to rebalance the loan mix to 58-60% retail, 23-25% wholesale, and balance SME over the planning horizon.

The bank aims to maintain a retail and commercial banking advances mix of approximately 70% of total advances, plus/minus 3-4%.

The bank plans to add 500 branches in FY24, with 207 added in Q2 and 110 new centers.

Management targets cost-to-assets ratio of around 2.1% by FY25, including Citi business, down from 2.41% in Q2 FY24.

CFO stated that if marginal cost of funds remains current, backbook repricing should be completed in Q2 of FY25.

Management expects pace of cost growth to moderate, having delivered 9% YoY growth in Q2.

Due to tightened classification norms for certain accounts (e.g., OTS), slippages in FY26 could be marginally higher than FY25.

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.

The bank targets a net interest margin of 3.8% over a two-cycle period starting from the last rate cut, with margins expected to follow an inverted C trajectory.

Assuming no further rate cuts, net interest margin is expected to bottom in Q3, with through-cycle stance at 3.8%.

Management reaffirmed the 3.8% NIM target over the cycle, despite 125 bps of repo rate cuts.

Management expects to achieve a through-cycle NIM of 3.8% within 15-18 months from the last rate cut transmission.

The bank expects to complete data migration and system integration of the acquired Citibank business by end of first half of FY25.

Management reiterated that the bank does not intend to raise equity capital, citing organic CET1 accretion of 39bps in 9M FY24.

Management reiterated that the bank does not need equity capital for either growth or protection pillars; capital raise resolution is purely enabling.

Q1 annualized net credit cost of 0.97% is not reflective of full-year expectations due to timing differences in recoveries.

Expense growth will moderate through FY25 from the 27-29% YoY range seen last year.

Bank does not need equity capital for growth or protection; may opportunistically evaluate Tier 2 and AT1 instruments.

Management confirmed that the technical recognition changes are a one-time adjustment and no further policy changes are expected unless regulatory norms change.

The provision is static and will be written back when loans are closed or by 31 March 2028, whichever is earlier.

Management reiterated that the bank does not need equity capital for growth or protection; may issue Tier 2/AT1 instruments opportunistically.