Axis Bank Reports Strong Financial Metrics Amid Ongoing Lending Capacity Challenges

Axis Bank has recently undergone a financial trend adjustment, reflecting a notable improvement in its performance metrics for the quarter ending March 2025. The bank reported its highest net interest income (NII) at Rs 13,810.54 crore and interest earned at Rs 31,242.51 crore, indicating strong operational efficiency. Additionally, the gross non-performing assets (NPA) ratio reached a low of 1.28%, showcasing effective asset quality management. Profit before tax, excluding other income, also peaked at Rs 2,613.50 crore, further highlighting the bank's robust financial health.
However, challenges remain for Axis Bank. The credit-deposit ratio for the half-year stood at 88.73%, which is relatively low, suggesting potential constraints in lending capacity. Furthermore, non-operating income constituted 72.18% of profit before tax, indicating a reliance on non-core activities.

In terms of market performance, Axis Bank's stock has shown varied returns compared to the Sensex. Over the past year, the bank's stock return was 3.37%, lagging behind the Sensex's 6.56%. However, over a three-year period, Axis Bank outperformed the Sensex with a return of 49.26% compared to 40.00%. This performance underscores the bank's resilience and adaptability in a competitive landscape.