Axis Bank shares fall 5% after Q1 earnings fail to cheer D-Street. What brokerages say

Shares of Axis Bank declined 5% to Rs 1,261 on the BSE on Monday even after the private lender reported a 22.5% year-on-year rise in standalone net profit to Rs 7,114 crore for the April-June quarter of FY27, with brokerages issuing mixed calls for the stock.

The private lender on Saturday released its Q1 FY27 results. Its net interest income (NII), meanwhile, rose more than 8% YoY to Rs 14,646 crore during the first quarter of the ongoing financial year 2027, from Rs 13,560 crore reported in the same period last year. Notably, this is higher than Nomura and Kotak Institutional’s estimates. Net interest margin during the quarter under review stood at 3.46%.

Axis Bank’s gross non-performing assets (GNPA) declined around 4% YoY to Rs 17,124 crore, while net NPA rose around 2.5% YoY to Rs 5,193 crore. The gross NPA and net NPA ratios improved on a YoY basis to 1.28% and 0.39%, respectively. However, both increased sequentially from 1.23% and 0.37% in Q4 FY26.

Provision and contingencies for Q1 FY27 stood at Rs 2,223 crore, while specific loan loss provisions stood at Rs 2,079 crore. Total deposits rose 3% QoQ and 18% YoY on a month-end basis, with current account deposits up 6% YoY, savings account deposits rising 14% YoY and term deposits increasing 23% YoY. The lender’s advances rose 19% YoY and 2% QoQ to Rs 12.62 lakh crore as on June 30, 2026.

Also read | Axis Bank Q1 Results: Net profit jumps 23% YoY to Rs 7,114 crore; NII up 8%

Nuvama on Axis Bank share price

Nuvama said Axis Bank delivered strong credit growth of 19%, but net interest margin slipped again by 16 bps QoQ to 3.46%, while management aims to pull it back to 3.8% over the next 12–15 months. Higher other income and lower provisions led to 9% PAT beat, it added.

GNPA inched up 5 bps QoQ to 1.3% due to seasonally higher agri NPAs, which should ease, according to Nuvama, which further noted that Axis has not used West Asia conflict related provisions. “We believe Axis will be a key beneficiary of FCNR flows, which should help retrace margins. This coupled with lower LLP should drive-up RoA from 1.4% in FY26 to 1.6–1.8% over FY27–29,” the brokerage said. Nuvama retained its ‘Buy’ call on the shares of Axis Bank with a target price of Rs 1,650 apiece. This implies an upside potential of more than 24% from the stock’s previous closing price of Rs 1,328.50 apiece on NSE.

Motilal Oswal on Axis Bank share price

Motilal Oswal noted that while Axis Bank’s net profit was 7% higher than its estimate, the bank’s NII and NIM missed expectations. It cut its FY27 and FY28 earnings expectations by 2% each and estimated FY28 RoA and RoE at 1.6% and 15.3% respectively. Axis Bank reported a weak quarter, Motilal Oswal said, noting that the bank reiterated its through-cycle NIM aspiration of ~3.8%, driven by an improving balance sheet mix. “Credit costs edged up marginally due to seasonally higher slippages, which also resulted in elevated interest reversals. Business growth remained modest, with corporate lending driving overall loan growth, while retail growth continued to be relatively subdued. Deposit growth was primarily led by term deposits, keeping the CD ratio broadly stable at ~92%,” it said.

The domestic brokerage has a ‘Neutral’ call on the shares of Axis Bank with a target price of Rs 1,500 apiece. This implies an upside potential of nearly 13% from the stock’s previous closing price.

What other brokerages say?

Centrum Broking said Axis Bank delivered a healthy quarter, reinforcing its positive view on the franchise despite near-term margin pressures. Its maintained its ‘Buy’ call on the shares of Axis Bank, but increased its target price to Rs 1,720 apiece, implying an upside potential of more than 29% from the stock’s previous closing price.

Systematix Institutional Equities meanwhile reduced its target price to Rs 1,570 apiece, while maintaining its ‘Buy’ rating on the stock. Dolat Capital meanwhile had an ‘Accumulate’ rating on the shares of Axis Bank, with a target price of Rs 1,525 apiece.

Also read: Axis Bank weighs raising stake in its insurance venture to 30%

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