Axis Bank Ltd — Q1 FY26
Axis Bank reported Q1 FY26 PAT of INR 5,806 crore, impacted by a technical recognition change that added INR 614 crore to provisions.
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Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
65%Questions answered1Evaded / deflected10Questions audited
Partial answer
High priority
Why are credit costs elevated and NIM compression more than expected?
Asked by Chintan Joshi, Autonomous Investments
Answered slippages but deferred on credit cost trajectory and gave qualitative margin outlook without numbers.
no specific credit cost guidancereframed margin trajectory as inverted C
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Question
Even after removing the technical impact, credit costs are quite high this quarter. What is driving this elevated level? ... And then on NII. The NIM compression that we have seen in this quarter seems to be a little bit more than what we were discussing in the previous earnings call.
Puneet Sharma, CFO
If you take your slippages question, adjusted for the technical impact, the slippages are exactly equal to one year equal to the Q3 FY25 number. ... The function of the actual P&L charge ... is a function of certain aging provisions plus the composition of slippages for the quarter.
Answered
High priority
Are technical downgrades recoverable and will they be upgraded?
Asked by Speaker 12, Kotak
Provided clear answer on recovery expectations and security cover.
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Question
So are the technical downgrades that we have done recoverable immediately, or they are recoverable through sale of collateral? ... which bucket or which classification do they fall into?
Puneet Sharma, CFO
The current intention is to recover this money, and our expectation is parts of this money will get recovered in the normal course of business as customer behavior changes ... 80% of these accounts have 100% security cover.
Answered
High priority
What led to the policy change and can you give examples?
Asked by Kunal Rao, Citi
Gave clear example and confirmed it was not regulatory-driven.
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Question
If you can explain slightly in detail in terms of what has happened with this policy and what actually led to this change? Is it more of a prudent measure? Was it identified during any kind of regulatory inspections?
Puneet Sharma, CFO
We can confirm to you that this was not regulatory-led. ... Let's take one example of a one-time settlement to illustrate ... we have stopped upgrading Sunit despite his DPD counter going to zero.
Partial answer
High priority
Is this technical recognition a gap versus peers and what is stock vs flow impact?
Asked by Param Subramanian, Investec
Answered prudence question but refused to quantify stock vs flow impact.
declined to give stock vs flow split
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Question
What exactly drove this? Is this a gap that you recognize versus peers, or is this Axis Bank being more prudent? ... And secondly, if you could call out how much is the impact on the bankbook versus the flow?
Puneet Sharma, CFO
We follow a benchmarking exercise once a year ... I do not think there is a bank that's more prudent than us on asset classification and upgrades combined. ... I'm not going to give you a stock versus flow impact.
Evasive
Medium priority
What would trigger higher retail growth given margin pressure?
Asked by Abhishek Murarka, HSBC
Gave general statements about ability to manage mix but no concrete trigger for retail growth.
no specific trigger or timeline given
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Question
At what point or what would trigger higher growth in retail, maybe not unsecured, but at least secured retail? Because surely that would be more yield or results compared to corporate.
Amitabh Chaudhry, MD & CEO
We have demonstrated our ability to grow certain asset classes at the cost of the other asset classes ... We expect growth to come back up in some of the other asset classes also as time goes by.
Partial answer
Medium priority
Will recoveries/upgrades be higher in H2 and will slippages be higher YoY?
Asked by Saurabh Nanavati, Sundaram Mutual Fund
Gave directional answer but refused to quantify or compare YoY.
declined to give YoY comparison
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Question
Would it be fair to assume that probably going into second half, your recovery or upgrade number would be meaningfully higher versus the current levels? ... would it be fair to assume that your slippages number for second, third, and fourth quarter would be higher this year versus YoY?
Puneet Sharma, CFO
Q2, Q3, Q4 will be more muted than Q1, simply because Q1 has corrected stock. ... we do not guide on slippages.
Answered
Medium priority
Why did borrowers not repay to avoid NPA classification?
Asked by M B Mahesh, Kotak Securities
Clearly explained that borrower behavior unchanged; classification change is bank's choice.
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Question
The borrower had nearly about 90 days to repay because there was a technical risk that the borrower was going to be declared as an NPL. And yet when we look at the upgrades and recoveries seen on the lower side, we're trying to understand why has the borrower not chosen to repay?
Puneet Sharma, CFO
Puneet's behavior has not changed at all. Puneet only has INR 30 to pay. Earlier, Puneet was not being classified while the bank waited for INR 30 to come in. ... The only change now is Puneet is being classified.
Partial answer
High priority
What is the net credit cost impact for FY26 and will FY27 normalize?
Asked by Akash Bhanshali, Enam Holdings
Confirmed FY27 normalization but refused to quantify FY26 impact.
declined to give FY26 estimate
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Question
Eventually, we've put a net cost of about INR 800 on credit costs from this adjustment. Through the year, we may have some recovered some. Net net would be possible for you to kind of, on a ballpark basis, estimate what the credit cost impact would be for the year.
Puneet Sharma, CFO
FY27 will be normalized with effect in comparison to FY26. That I would agree with. ... I wouldn't want to guide on what the value of recoveries and upgrades versus fresh slippages on the criteria would be.
Answered
Medium priority
Breakup of gross vs net slippages by segment?
Asked by Jay Yadav, ICICI Securities
Provided clear segment-wise breakup of slippages.
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Question
If you can give the breakup of this INR 6,000 gross of net slippages. So INR 8,200 minus INR 2,100 gross, so INR 6,053 gross of net slippages breakup between retail, wholesale, and commercial.
Puneet Sharma, CFO
Net slippage reported is INR 6,053. Technical impact is INR 1,861. So apples to apples net slippages is INR 4,192. ... Reported net slippage wholesale is INR 190. CVD is INR 137. Retail is INR 5,726.
Partial answer
Medium priority
Any deposit outflows after rate cut and normalized credit cost?
Asked by Nitin Aggarwal, Motilal Oswal
Answered deposit question but refused to quantify normalized credit cost.
declined to give normalized credit cost number
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Question
Have we seen any outflows there? And what was the composition of CASA deposits above INR 50 lakh? ... when you say that FY27 will be more normalized, how should we look at that?
Amitabh Chaudhry, MD & CEO and Puneet Sharma, CFO
On deposits from after the rate cut, I don't think we've seen any shift in the INR 50 lakh deposits etc. ... Nitin, we won't give you specific guidance on what you're asking for.