AXIS BANK
vs HDFC BANK
Q2 FY 2012 RESULTS
COMPARISON
AXIS
BANK and HDFC BANK are 2 private Banks which have been performing very
consistently and Growing very steadily over the last several quarters.
HDFC
Bank is slightly Bigger, and
manages to perform better in many quarters, though Axis Bank outwits it in some
quarters. In each quarter also – there are some areas in which HDFC Bank
performs better and in some other Areas, Axis Bank performs better.
A comparison of their performances gives an insight to
Investors – about the relative strengths of not only these Banks – but also of
the Banking Sector in general.
Here is a comparison of the performances of these 2
banks in Q3 FY 2012 ending Dec,2011.
Interest
on Advances of Axis Bank stands at
Rs.3963.56Cr having grown at 7.48% from previous qtr and 52.41% from
Corresponding Qtr. The amount for HDFC Bank is Rs.5417.49 Cr, with 8.46% growth
un Previous qtr and 37.14% in
corresponding Qtr.
Income
on Investments for AB (Axis Bank) stands
at Rs.1775.23 cr ,up 14.63% from previous Qtr and 52.14% from corresponding Qtr. The same for
HB (HDFC Bank) stands at Rs.1747.57 cr,
up by 8% from previous qtr and up by
42.56% from corresponding Qtr.
Net
Intt Income for AB stands at Rs.2140.30
cr, up by 6.63% from previous qtr and up by 23.49% from corresponding Qtr. The
same for HB is Rs.3115.99 Cr, up by 5.82% from previous qtr and up by 12.22%
from corresponding qtr.
Total
Income of AB stands at Rs.7206.77
cr, up by 10.69% from previous qtr and up by 44.54%
from corresponding Qtr. The same for HB is Rs.8622.64 cr – up by 8.74% from
previous qtr and up by 35.62^ from corresponding qtr.
As these growth figures indicate very clearly, HDFC
Bank is ahead of Axis in absolute numbers of Income Heads, but in growth
percentages, Axis is scoring much better- and is closing the gap between
the two.
But, total Expenditure excluding provisions for AB – stands at Rs.5147.57 cr, up by 8.71% from previous qtr, and up by 54.7%
from corresponding qtr. The same for HB
stands at Rs.6244.61 cr, up by 7.6% in
previous qtr and up by 45.73% from corresponding Qtr. Here, HB seems to control
expdr better. Its growth is less in % terms.
Operating
Profit of AB stands at Rs.2059.20
cr, up by 15.97% from previous Qtr and up by 24.16% from corresponding Qtr. The
same for HB is Rs.2378.03 cr, up by 11.87% for previous Qtr and up by 14.73%
for corresponding Qtr. At OPT level, the growth rates are more impressive for
AB compared to HB.
Provisions for AB is at Rs.422.33 Cr, up by 4.13% from previous
qtr and up by 34.55 from corresponding qtr. The same for HB is Rs.329.24 cr,
down by -10.06% from previous qtr and down by
-29.33% from corresponding Qtr. HB is very impressive in regard to provisions
compared to AB.
Profit before tax (after provisions) stands at Rs.1636.87 cr for AB, up by 19.47% from previous qtr and up by 21.74%
from corresponding qtr. The same for HB is
Rs.2048.79 cr, up by 16.43% from previous qtr and up by 27.51% from
corresponding qtr. While both have scored above 20% growth – Growth of HB is
much better due to lesser Provisions in the corresponding qtr.
Tax
Expense for AB stands at Rs.534.60
cr, up by 18.87% from previous qtr; and up by 17.95%
from corresponding Qtr. The same for HB
is Rs.619.13 Cr, up by 10.48% from previous qtr and up by 19.3% from
corresponding Qtr.
Finally, at the Net Profit Level, the figure for AB is Rs.1102.27
cr , up by 19.77% from previous qtr; and up by 23.66% from corresponding qtr.
The same for HB is Rs.1429.66 cr – up by 19.2% from previous qtr (almost same
rate as for AB); and up by 31.42% from
corresponding qtr (compared to 23.66% for AB). Thus, it seems, that Provisions
has pulled down AB’s profits Growth below that of HB.
Capital
Adequacy Ratio at 11.78 is adequate for
AB, but it is going for augmenting its capital. Axis Bank has passed a resolution approving Allotment of
Unsecured Redeemable Non-Convertible Subordinated Debentures on private
placement basis as the Bank's Lower Tier II capital aggregating to Rs. 1,500
crores (including green shoe option of Rs. 500 crores). This should see AB
growing more rapidly in the next few qtrs. HDFC Bank has a CAR of 16.3, which
should be good enough for some more time for it. So, both are keeping adequate
Capital to service their operations.
Basic
EPS of AB on a FV of Rs.10 is
Rs.26.73; whereas the same for HB on a FV of Rs.2 is 6.1 (or Rs.30.5 on a FV of Rs.10). If
Provisions come down for Axis Bank, this gap will be bridged.
Gross/Net
NPA for AB is higher at Rs.682.93
cr , while the same for HB is Rs.397.96 Cr.
The same as % terms is – the % of Gross/Net NPA is at 0.39 for AB and 0.2 for HB. While it is veryLOW for both AB
and HB, HB enjoys the edge here.
Return
on Assets is an excellent 1.68 for Axis bank while the same is 0.5
for HDFC Bank.
The annualized
EPS of Axis Bank for FY 2012
can be around Rs.99 to 100.While the same can be around Rs.22 x 5 = 110.
The Current Market
prices are Rs.1018 for Axis Bank and Rs.486.76 for HDFC Bank (FOR Rs.2
share; i.e.,r Rs.2433.75 for Rs.10 face value).
The PE ratio for Axis Bank is 1018/100 = 10.18.
The PE Ratio for HB is 486.75 /22 = 22.125.
Market will need to take a Good Re-look at these
valuations and bring them a little closer (by upgrading Axis Bank more).
Both are excellent companies – growing at good growth
rates, very consistently over several quarters Now.
RESULTS
COMPARISON TABLE
AXIS
BANK
|
31-Dec-11
|
%dif1
|
%dif2
|
HDFC
BANK
|
31-Dec-11
|
%DIF1
|
%DIF2
|
Interest on Advances
|
396356
|
7.48
|
52.41
|
Interest on Advances
|
541749
|
8.46
|
37.14
|
Income on Investments
|
177523
|
14.63
|
52.14
|
Income on Investments
|
174757
|
8
|
42.56
|
Income on Balances With RBI
|
1547
|
38.5
|
-67.89
|
Income on Balances With RBI
|
3459
|
5.01
|
-33.11
|
Others
|
2270
|
-19.9
|
-0.22
|
Others
|
299
|
-95.83
|
46.57
|
Interest Earned
|
577696
|
9.5
|
50.51
|
Interest Earned
|
720264
|
7.22
|
37.72
|
Other Income
|
142981
|
15.78
|
24.58
|
Other Income
|
142000
|
17.19
|
25.91
|
Total Income
|
720677
|
10.69
|
44.54
|
Total Income
|
862264
|
8.74
|
35.62
|
Interest Expended
|
363666
|
11.26
|
72.75
|
Interest Expended
|
408665
|
8.31
|
66.58
|
Net Intt Income
|
214030
|
6.63
|
23.49
|
NET INTT INCOME
|
311599
|
5.82
|
12.22
|
Employees Cost
|
54204
|
8.71
|
36.82
|
Employees Cost
|
86742
|
5.38
|
19.64
|
Other Oprtng Expenses
|
96887
|
0.1
|
17.27
|
Other Oprtng Expenses
|
129054
|
6.9
|
16.6
|
Oprtng Expenses
|
151091
|
3.03
|
23.61
|
Oprtng Expenses
|
215796
|
6.28
|
17.8
|
Total Expdr excl provi.
|
514757
|
8.71
|
54.7
|
Total Expdr excl.provisions
|
624461
|
7.6
|
45.73
|
Operating Profit
|
205920
|
15.97
|
24.16
|
Operating Profit
|
237803
|
11.87
|
14.73
|
Provisions
|
42233
|
4.13
|
34.55
|
Provisions
|
32924
|
-10.06
|
-29.33
|
Profit before tax
|
163687
|
19.47
|
21.74
|
Profit before tax
|
204879
|
16.43
|
27.51
|
Tax Expense
|
53460
|
18.87
|
17.95
|
Tax Expense
|
61913
|
10.48
|
19.3
|
Net Profit
|
110227
|
19.77
|
23.66
|
Net Profit
|
142966
|
19.2
|
31.42
|
Face Value(Rs.)
|
10
|
0
|
0
|
Face Value(Rs.)
|
2
|
0
|
-80
|
Paid-up Equity
|
41257
|
0.06
|
0.65
|
Paid-up Equity
|
46826
|
0.13
|
0.85
|
Capital Adequacy Ratio
|
11.78
|
3.79
|
-5.46
|
Capital Adequacy Ratio
|
16.3
|
-1.21
|
0
|
Basic EPS
|
26.73
|
19.7
|
22.78
|
Basic EPS
|
6.1
|
19.61
|
|
Gross/Net NPA
|
68293
|
24.45
|
77.14
|
Gross/Net NPA
|
39796
|
12.02
|
20.35
|
% of Gross/Net NPA
|
0.39
|
% of Gross/Net NPA
|
0.2
|
0
|
0
|
||
Return on Assets
|
1.68
|
10.53
|
-4
|
Return on Assets
|
0.5
|
25
|
25
|
*
* * E
N D *
* *
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