When one talks about top investment picks from the Indian Banking Sector the Big Three from the Private Banks' space are definitely HDFC Bank, ICICI Bank and Axis Bank. We have already had a look at the first two in earlier posts and in this post we will examine AXIS Bank from the investment angle.
AXIS Bank is smaller than the other two, at a Market Cap of about Rs 50000 crores. At CMP of Rs 1248 (52 week high 1608 and 52 week low 1023) it is available at a Price to Book of 2.71 which is a tad higher than that of ICICI Bank (2.02) but substantially lower than that of HDFC Bank (4.41). However what sets it apart is its aggressive growth strategy.
AXIS Bank has delivered excellent Q1 FY 11-12 results reporting a 20% YOY Net Profit growth ; a 14% Net Interest Income growth YOY; has more or less maintained their Net Interest Margins between 3.25% and 3.5%; and have maintained a healthy CASA Ratio of 40%.
In terms of Market performance Axis Bank has given returns of about 8% in the last 6 months despite the hard Interest Rate Regime. Its 50 DMA is 1275 and 200 DMA is 1313 . Axis Bank is somewhat more volatile than the other two ie HDFC Bank and ICICI Bank but nevertheless is an institutional favourite. A point to be kept in mind is that if one believes that the Interest Rate Cycle is peaking out or is close to its peak, then this may be the best time to start accumulating good Bank Scrips before the Price starts running away. We dont want to end up chasing Prices too often.
In my opinion, Axis Bank is a good buy at CMP 1250 odd and all dips, were one to get them.
AXIS Bank is smaller than the other two, at a Market Cap of about Rs 50000 crores. At CMP of Rs 1248 (52 week high 1608 and 52 week low 1023) it is available at a Price to Book of 2.71 which is a tad higher than that of ICICI Bank (2.02) but substantially lower than that of HDFC Bank (4.41). However what sets it apart is its aggressive growth strategy.
AXIS Bank has delivered excellent Q1 FY 11-12 results reporting a 20% YOY Net Profit growth ; a 14% Net Interest Income growth YOY; has more or less maintained their Net Interest Margins between 3.25% and 3.5%; and have maintained a healthy CASA Ratio of 40%.
In terms of Market performance Axis Bank has given returns of about 8% in the last 6 months despite the hard Interest Rate Regime. Its 50 DMA is 1275 and 200 DMA is 1313 . Axis Bank is somewhat more volatile than the other two ie HDFC Bank and ICICI Bank but nevertheless is an institutional favourite. A point to be kept in mind is that if one believes that the Interest Rate Cycle is peaking out or is close to its peak, then this may be the best time to start accumulating good Bank Scrips before the Price starts running away. We dont want to end up chasing Prices too often.
In my opinion, Axis Bank is a good buy at CMP 1250 odd and all dips, were one to get them.
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