Axis Bank trades lower ahead of Q4 results
The scrip was down 1.22 per cent at Rs 492.30 at around 11.40 am (IST).
The bank, which is mired in a controversy owing to a surge in bad loans and over CEO Shikha Sharma's tenure, is likely to put up a dismal show, said analysts.
Prabhudas Lilladher sees over 50 per cent year-on-year fall in net profit of Axis Bank. “Overall profitability to be suppressed on likely sharp deterioration in asset quality with estimated slippages of Rs 6,400 crore,” the brokerage house said in a report.
Brokerage firm Centrum has projected a fall of 88.30 per cent in net profit on a year-on-year basis in Q4FY18.
Axis Bank has 3.8 per cent of its loans in the watchlist category. The RBI circular has stipulated timelines towards resolution of these accounts. It, however, requires banks to create accelerated provisioning towards these loans. "We thus have factored in elevated slippages and credit cost for Q4 FY18. NII growth however is expected to remain weak at mere 1.9 per cent YoY following interest reversals," Centrum said.
Sharekhan has estimated 59 per cent year-on-year drop in net profit for Axis Bank.