Axis Bank Q2 net profit jumps 38% to Rs 7,003 crore on strong core income

Axis Bank reported a 38% year-on-year jump in net profit to Rs 7,003 crore for the second quarter of FY27, backed by double-digit growth in interest earnings and an ongoing strengthening of its balance sheet.

The private sector lender had posted a net profit of Rs 5,089 crore in the corresponding period last year. The earnings momentum reflects the broader stability in India's banking sector, with strong domestic demand driving double-digit loan growth across retail, small enterprise, and corporate segments.

Key performance metrics for Q2FY27

Net interest income, the core difference between interest earned on loans and paid on deposits, increased 12% year-on-year to Rs 15,371 crore. The bank's net interest margin stood at 3.36% for the quarter, rising to 3.47% after excluding foreign currency non-resident deposit impacts.

Asset quality showed clear improvement as fresh slippages declined. Gross non-performing assets fell 30 basis points to 1.16%, while net non-performing assets dropped to 0.35%. Gross slippages fell to Rs 4,762 crore, down from Rs 5,566 crore in the previous quarter and Rs 5,696 crore a year earlier.

Total provisions and contingencies were reduced to Rs 1,694 crore, down by over half compared to previous elevated levels, as credit costs annualised at 0.45%. The bank maintains a provision coverage ratio of 70%.

Loan mobilization remained brisk across all business lines. Total advances expanded 23% year-on-year to Rs 13.74 lakh crore, led by a 34% jump in corporate lending and a 25% increase in SME advances. Retail loans rose 16% to Rs 7.40 lakh crore, accounting for 54% of the lender's overall book.

Total deposits grew 21% year-on-year to Rs 14.52 lakh crore, propelled by a 27% gain in term deposits. The bank's current account and savings account ratio stood at 36%.

Chief executive Amitabh Chaudhry attributed the earnings to consistent execution and sustained investments in digital infrastructure, noting that the lender continues to expand its leadership in secure banking and artificial intelligence applications. Capital reserves remained robust, with the capital adequacy ratio at 16.27% and common equity tier-1 ratio at 14.61%.