For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

Buy This Large Cap Private Sector Bank Stock For Over 60% Gains, Paying 50% Dividend

|

ICICI Securities has given a buy call to Axis Bank for a target price of Rs 1,050/share. Considering the brokerage's estimated target price and the bank's Current Market Price (CMP) of Rs 654.35/share, investors who buy the shares of the stock now at CMP could expect gains of over 60%. The brokerage in its report ahs stated about Axis Bank's FY22 annual report, which was themed 'Open to a world of possibilities', where Axis Bank is setting out on a journey of distinctiveness to become an open, customer-centric and future-ready bank that will offer its customers 'a world of new possibilities'.

 

Stock outlook

Stock outlook

On June 04, 2022, Axis Bank's stock CMP (Current Market Price) is Rs 654.35/share, gained 1.61% from its previous close. The 52-week low of the stock is Rs 618.25, while the 52-week high is Rs 866.90/share. It touched the 52-week low last month. The P/E ratio is 14.23, PB ratio is 1.67. EPS-TTM is Rs 45.99. The market cap of the Axis bank is Rs 2,00869 crore.

The target price of the stock estimated by the brokerage is Rs 1050/share. Considering the Target Price and the CMP of the stock, the stock is likely to gain nearly 61%.

Although the shares of the bank has witnessed a fall in price in the past 1 year, nearly 12.83%, it has given positive returns in past 5 years of 28.71%.

Stock Details 
CMPRs 654.35
Target PriceRs 1050
Potential Gains61%
52 week lowRs 618.25
52 Week HighRs 866.90
1-Year Return-12.83%
5-Years Returns28.71%
Axis Bank Dividend
 

Axis Bank Dividend

Over the past 21 years, Axis Bank has a solid track record of paying out dividends. Since June 2001, the company has declared 19 dividends. It is important to note that all 19 distributions are final dividends and that the company has not yet announced any interim or special dividends.

In its Board of directors meeting held on April 28, 2022, the company declared a final dividend of 50% amounting to Rs 1 per share for the march ending 2022. The ex-dividend date of the declared final dividend is 07 July 2022, and the record date is 08 July 2022.

Incremental insights from annual report

Incremental insights from annual report

  • Citi's India consumer business transition and integration process is progressing well and remains well on track. Transaction closing is expected by Q4FY23 and full integration 18 months thereafter.
  • GPS strategy execution progressing well with 19 large transformational projects.
  • In FY22, non-retail term deposits had risen 58% to Rs1.65trn, constituting >20% of overall deposits and top 20 depositors constituting 10% (vs 7.9% in FY21). Retail TD grew merely 4% to Rs2.87trn. Retail liability strategy is centered around granularisation, premiumisation and deepening of the deposit base. In FY22, it added 8.6mn (up 29% YoY) new liability relationships with over 4.3mn new SA relationships (53% higher YoY).
  • In FY22, it pivoted the growth in retail book towards identified focused segments like small business banking (60% growth YoY) and rural and gradually accelerated growth across personal loans (up 15% YoY) and credit cards (19% growth YoY). Axis sourced 65% of its retail assets from its ETB customers and 51% sourcing was done through branches.
  • Focused segments like mid-corporate, commercial banking (CBG) and MNC registered 45%, 26% and 49% YoY growth. New to bank SME business book grew 53%, and nearly 20% of premium Burgundy Private and Burgundy accounts were sourced through CBG segment.
  • IT team strength has grown by 75% with over 2x increase in technology spends in the last 2 years.
  • Bank's PSL achievement was 44.86% (of adjusted net bank credit) during FY22. In FY22, it purchased PSLCs worth Rs 535.5bn at the cost of Rs 12.5bn and sold PSLCs worth Rs 544bn, earning income of Rs3.5bn. Priority sector lending deposits reduced to Rs 416bn in FY22 from Rs 469bn in FY21.
  • Nearly 28% of overall card issuances were through 'Known to Bank' partnerships with Flipkart, Google Pay, Freecharge and others.
  • Retail banking constituted 64% (vs 62% in FY21) of the bank's fee income. Axis Bank's granular fee across third-party distribution grew 29% on a YoY basis with investment and insurance-related fees up 48% and 22% YoY, respectively. Retail card fees and retail non-card fees constituted 22% and 42%, respectively, of the fee income.
  • Investment phase on, management refrains from near-term cost to assets guidance: In FY22, 36% of incremental cost was on account of investments in technology and future growth, 22% was volume linked, 15% was collection linked and statutory expenses and balance 27% was business as usual expenses.
Valuation

Valuation

According to Axis Bank's Annual report, the GPS strategy execution and Citi acquisition progressing well. ICICI Securities has given a buy rating to Axis Bank with the estimated target price of Rs 1,050 per share. According to the brokerage's estimated target price, the stock of Axis Bank sees a potential gain of 61%.

About - Axis Bank

About - Axis Bank

Axis Bank is the third largest private sector bank in India. The Bank offers the entire spectrum of financial services to customer segments covering Large and Mid-Corporates, MSME, Agriculture and Retail Businesses. The Bank has a large footprint of 4,758 domestic branches (including extension counters) with 10,990 ATMs & 5,972 cash recyclers spread across the country as of 31st March 2022. The Bank has 6 Axis Virtual Centers with over 1,500 Virtual Relationship Managers as of 31st March 2022. The bank's overseas operations of the Bank are spread over eight international offices.

Disclaimer

The stock has been picked from the brokerage report of ICICI Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.

Company Search
Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X