Thursday, July 19, 2012
AXIS BANK RESULTS FOR FIRST QUARTER (Q1 FY 2012-13) - NPT UP 22%YoY; NET NPA 0.31%; VERY GOOD PERFORMANCE
RESULTS FOR FIRST QUARTER
(Q1 FY 2012-13)
Results at a Glance
Ø Net Profit during Q1FY13 rose to Rs.1,154 Cr from Rs.942 Cr in Q1FY12, registering a growth of 22% YOY.
Ø Demand Deposits grew 17% YOY from Rs.74,414 Cr as on 30th June 2011 to Rs.86,942 Cr as on 30th June 2012. Savings Bank deposits in the same period grew 23% YOY. Current and Savings Bank deposits were 39% of aggregate deposits at the end of June 2012.
Ø Net Interest Income and Other Income for Q1FY13 registered a growth of 26% and 14% respectively. Net Interest Margin for Q1FY13 was 3.37% compared to 3.28% in Q1FY12. Operating profit for Q1FY13 grew 26% YOY.
Ø Asset quality was healthy with Net NPA at 0.31%.
Ø The Bank is well-capitalised with a Capital Adequacy Ratio of 13.51% (including net profit for Q1) as at the end of Q1FY13 compared to 13.01% (including net profit) as at the end of Q1FY12. Tier-I capital was 9.49% (including net profit for Q1) of risk weighted assets at the end of Q1FY13, compared to 9.84% (including net profit) as at the end of Q1FY12.
D E T A I L S
Operating profit rose 26% YOY to Rs.1,964 Cr during Q1FY13 from Rs.1,558 Cr during Q1FY12. The net profit during Q1FY13 rose to Rs.1,154 Cr from Rs.942 Cr in Q1FY12 registering a growth of 22% YOY.
ITEM :: Q1 FY13 :: Q1 FY 12 :: Growth %
Net Profit : 1,153.52 : 942.35 : 22%
EPS Diluted (Rs.) : 27.73 : 22.67 :: 22%
At the current rate of EPS (not taking into account any future Growth), the annualized EPS works out to Rs.111.
At the current Market price of around Rs.1050/-, the PE Ratio works out to 9.46 – which is TOO LOW for the Axis Bank. There is good scope for Axis Bank market Price to improve – as market sentiment improves. In any case, it is a GOOD BUY for Medium / Long Term Investors.
Net Interest Income rose 26% YOY to Rs.2,180 Cr during Q1FY13 from Rs.1,724 Cr during Q1FY12. The net interest margin was 3.37% in Q1FY13, compared to 3.28% during Q1FY12.
Fee income during Q1FY13 stood at Rs.1,154 Cr up 9% YOY. Retail Banking registered a growth of 17% YOY, rising to Rs.322 Cr. Business Banking fees grew 16% YOY and stood at Rs.110 Cr. Treasury and DCM segment fees grew 13% YOY and stood at Rs.238 Cr. Fee income from Agriculture & SME Banking grew 36% YOY to reach Rs.63 Cr. Large and Mid-Corporate Credit (including Infrastructure) fees contracted marginally by 1% YOY and stood at Rs.409 Cr. Fee income from Equity Capital Markets (including Trusteeship Services) too saw a contraction by 29% YOY and stood at Rs.12 Cr.
The Bank generated Rs.150 Cr of trading profits during Q1FY13, compared to Rs.70 Cr during Q1FY12, a growth of 114% YOY. Share of trading profits to operating revenue was 4% in Q1FY13, compared to 2% in Q1FY12.
Shareholders’ funds of the Bank were Rs.24,253 Cr as on 30th June 2012 growing 21% YOY from Rs.20,017 Cr as on 30th June 2011.
Capital Adequacy Ratio (CAR) for the Bank was 13.03% (excluding net profit for Q1FY13), as on 30th June 2012, compared to 12.53% (excluding net profit for Q1FY12) as on 30th June 2011.
Tier-I capital adequacy ratio was 9.02% (excluding net profit for Q1FY13) as on 30th June 2012, compared to 9.36% (excluding net profit for Q1FY12) as on 30th June 2011.If the net profit of Rs.1,154 Cr for Q1 this year is included, the total CAR and Tier-I CAR as on 30th June 2012 would be 13.51% and 9.49% respectively.
Demand deposits grew 17% YOY from Rs.74,414 Cr as on 30th June 2011 to Rs.86,942 Cr as on 30th June 2012. On a daily average basis, demand deposits constituted 36% of total deposits during Q1FY13, as against 37% in Q1FY12. The daily average balances in CASA deposits during the quarter grew 16% YOY, buoyed up by S.B.deposits which grew 22% over the year. At the end of the quarter, CASA deposits together accounted for 39% of total deposits of the Bank.
Advances grew 30% YOY from Rs.1,31,900 Cr as on 30th June 2011 to Rs.1,71,146 Cr as on 30th June 2012. However, normalised YOY growth in advances would be 21% adjusting for currency depreciation of 25% during the year and a relatively lower base caused by run-offs in short-term loans in the previous period.
Investments rose to Rs.87,986 Cr from Rs.75,307 Cr over the same period, registering a growth of 17% YOY.
NPAs and Restructured Assets : Gross NPAs as proportion of gross customer assets and Net NPAs as a proportion of net customer assets were unchanged vis-à-vis previous year and stood at 1.06% and 0.31% respectively for the period ended 30th June 2012. The Bank held a provision coverage of 79% as on 30th June 2012. The provision coverage (as a proportion of Gross NPAs) before accumulated write-offs was 90%.
During the quarter, the Bank added Rs.456 Cr to Gross NPAs. Recoveries and upgrades of Rs.62 Cr and write-offs of Rs.108 Cr during the quarter resulted in a closing position of Rs.2,092 Cr of Gross NPAs as on 30th June 2012, as against Rs.1,573 Cr as on 30th June 2011.
The Bank restructured assets aggregating Rs.628 Cr during Q1FY13. The cumulative value of assets restructured till 30th June 2012, rose to Rs.3,827 Cr (1.95% of gross customer assets). Of the outstanding pool, assets amounting to Rs.1,231 Cr have displayed a satisfactory repayment track-record of two years. Adjusting for these assets, restructured assets would constitute 1.32% of gross customer assets. The segment-wise break-up of restructured assets as on 30th June 2012 is as follows:
Large and Mid-Corporate Credit : 80% : SME : 6% ;
Agri. including Micro finance : 7% ; Capital Markets : 7% ;
The sector-wise breakup of restructured assets as on 30th June 2012 was as follows.
Textiles : 14% ; Petroleum : 12% ; Edible Oils : 12% ;
Shipping : 11% ; Infrastructure : 9% ; Others : 42%
Network : The Bank, at the end of Q1FY13, had a network of 1,674 domestic branches and extension counters and 10,337 ATMs situated in 1,080 cities and towns. During the quarter, the Bank added 52 branches and 413 ATMs.
Retail Business : No. of S B accounts grew 26% from 99.02 lacs as on 30th June 2011 to 124.45 lacs as on 30th June 2012. Retail advances grew from Rs.27,022 Cr as on 30th June 2011 to Rs.40,591 Cr as on 30th June 2012, a growth of 50% YOY. Retail Advances accounted for 24% of the total advances of the Bank as on 30th June 2012. The Bank's International Debit Card issuance has risen to 131 lac debit cards as on 30th June 2012, as compared to 105 lac debit cards in force as on 30th June 2011. The Bank had over 8.24 lac credit cards in force as on 30th June 2012.
Placement / Syndication : The Bank arranged debt aggregating Rs.27,695 Cr during Q1FY13 rising 45% over Q1FY12. The Bank was assessed as the No.1 Debt Arranger Rupee denominated bonds for six month period ended June 2012 by Bloomberg. The Bank was assessed No.1 debt arranger for the year ended March 2012 by Prime Database.
Enam Update : During the current quarter, pursuant to the order passed by the High Court of Gujarat at Ahmedabad, the equity shareholders and unsecured creditors of the Bank have at their meetings held on 23rd June 2012, approved the Scheme of Arrangement in respect of the demerger of the financial services business from Enam Securities Private Limited to the Bank and a simultaneous sale of such businesses to Axis Sales & Securities Limited, a wholly owned subsidiary of the Bank, with effect from 1st April, 2010. The Bank is now awaiting the necessary approvals under applicable law from various regulatory authorities to the Scheme of Arrangement and consequently, no effect of the acquisition has been given in the results for the current quarter.
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