Nalanda Securities is bullish on Axis Bank recommended buy rating on the stock with a target price of Rs 882 in its research report dated April 26, 2019.
Nalanda Securities' research report on Axis Bank
Axis Bank reported good set of numbers for Q4FY19 led by 62% YoY decline in provisions and hence 37% growth in operating profits. Its NII grew by ~21% YoY in Q4FY19 led by healthy loan growth (+13% YoY) and an improvement in the Net Interest Margins (3.4% in Q4FY19 Vs 3.3% YoY). The non-interest income reported a growth of ~26% YoY in Q4FY19 majorly led by 1) 23% YoY growth in the fee income and 2) the treasury has reported a profit of INR 354 crores in Q4FY19 as compared to INR 216 crores in Q4FY18.
Outlook
At a CMP of 745, the stock is trading at FY21E adjusted P/BV of ~2.5x. The bank use to trade at 2.7x of its last three years forward Adj. P/BV, we have assigned similar multiple (and valued subsidiaries separately) to arrive at a fair value of INR 882 per share, seeking an upside of 18.4% from the current levels.
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