axis bank share price: Axis Bank hits 52-week high post Q1 earnings. Should you buy?

Axis Bank shares hit their 52-week high of Rs 990 on the NSE in Thursday’s opening trade, gaining 1.3% over the previous close on stable June quarter earnings along with favourable views from top brokerages.

Among international brokerages, Jefferies maintained a ‘Buy’ on the counter while back home, Nuvama and Motilal Oswal also retained a ‘Buy’ stance.

India’s fourth-biggest private lender by market value reported a standalone net profit of Rs 5,797.10 crore for the quarter ended June 2023, up 40% year-on-year (YoY) over Rs 4,125.26 crore profit reported by the company in the corresponding period of the last financial year. An ET NOW poll of analysts had anticipated the profit figure at Rs 6,000 crore.

This is what top brokerages recommended:

Jefferies: Buy | Target: Rs 1,200
Jefferies has a ‘Buy’ rating on the stock and a target price of Rs 1,200. The US-based brokerage said margins held up better than feared, adding that a large part of the cost hike has seeped through. Softer QoQ momentum was on account of asset growth with stable quality. The trends are likely to clear up from Q2, it said in a note. Axis is among its top picks given favourable risk-reward.

Motilal Oswal: Buy | Target: Rs 1,150
Motilal recommended a ‘Buy’ on Axis Bank, estimating an 18% upside at Rs 1,150 over the previous closing price of Rs 977. Axis Bank delivered a stable performance in 1QFY24, with earnings driven by higher ‘other income’ even as margins compressed on expected lines, the brokerage said.

Business growth was healthy, led by traction across segments, it said adding that the asset quality remains broadly stable with an increase in fresh slippages. “We made slight adjustments to our estimates and expect AXSB to deliver RoA/RoE of 1.9%/17.7% in FY25,” Motilal said.

Nuvama: Buy | Target: Rs 1,130
Nuvama has a ‘Buy’ stance on Axis Bank and puts the price target at Rs 1,130. The private lender reported a soft quarter with weaker-than-sector loan, deposit and core Pre-Provision Operating Profit (PPOP) growth sequentially, the brokerage noted. Core PPOP, at 9% QoQ, declined the most among reporting banks.

The brokerage said that the short-term performance is capped though the long-term view is that the franchise has scope to improve. “We increase our TP marginally to Rs 1,130 based on 2X BV FY25E from 1.9X,” it said.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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