Axis Bank Q2 profit rises 18% on strong core biz growth

Axis Bank reported an 18% increase in standalone net profits for the second quarter, reaching ₹6,917.57 crore, up from ₹5,863.56 crore in the same period last year. The robust profit growth was fuelled by a 24% rise in operating profits and a 10% increase in core operating profits year-on-year.

Total standalone income rose 17% to ₹37,142 crore, compared to ₹31,660 crore in the previous year. Meanwhile, total expenditure increased by 18%, totalling ₹27,751.90 crore, up from ₹23,956.27 crore in the corresponding quarter.

Operating expenses increased to ₹9,493 crore, up 9% from ₹8,717 crore, while staff expenses rose year-on-year from ₹2,610 crore to ₹3,117 crore, marking a 19% increase.

Deposits grew 14% from ₹9,55,556 crore to ₹10,86,744 crore this quarter. Year-on-year, term deposits rose by 21%, current accounts increased by 13%, and savings accounts saw a modest 1% rise. The average Liquidity Coverage Ratio for Q2 FY25 was approximately 115%.

Investments rose 18% from ₹2,95,691 crore to ₹3,48,855 crore. The bank experienced a 10% decline in other assets, including indemnification assets and intangible assets such as patents and copyrights, decreasing from ₹72,046 crore to ₹64,822 crore. Gross advances reached ₹9,99,979 crore, up 11% from ₹8,97,347 crore in the previous year’s same quarter, reflecting a 12% year-on-year increase. Retail loans grew by 15%, while Small Business Banking (SBB) loans surged by 23%. The Mid-Corporate (MC) loan book expanded by 18%. The combined portfolio of SBB, SME, and MC loans reached ₹2,22,080 crore, representing 22.2% of total loans and an increase of approximately 800 basis points over the past four years.

On the lender's Q2 earnings, MD and CEO Amitabh Chaudhry said that Axis Bank effectively balanced digital innovation with physical expansion to enhance customer proximity. The fourth-largest private lender opened 150 new branches in urban and rural areas over the past three months.

“We also expanded our private banking business ‘Burgundy Private’ network to 15 new cities increasing its presence to 42 locations across India, offering bespoke wealth management services in India's rapidly evolving Tier-2 markets," Chaudhry added.

In Q2 FY25, Axis Bank demonstrated robust growth in its credit card segment, issuing approximately 1.06 million new cards. The bank excelled in Retail Digital Banking, with digital transactions making up 96% of total financial transactions by individual customers.

Additionally, 77% of new mutual fund SIPs were sourced through digital channels, and 76% of savings accounts were opened via tab banking, the bank stated in its official press statement. The bank reported a remarkable 65% year-on-year growth in total UPI transaction value and a 41% increase in mobile banking transaction volumes. Notably, 42% of individual retail term deposits (by value) were opened digitally.