Axis Bank Q2 Results

The bank suffered a net loss of Rs 112 crore for the quarter due to a Rs 2,138-crore one-off deferred tax asset

The analysts would watch out for the management's commentary on "the stressed asset cropped up recently and delay or failure for resolution in the near term which could endure higher provisions

The stock dipped 7% to Rs 475 on the BSE in early morning trade.

Gross NPAs and net NPAs stood at 5.9% and 3.12% in September quarter against 5.03% and 2.30% in the June quarter respectively

After showing hopes of a rebound and levelling of asset quality issues in June quarter, the Street had reasonable expectations from Axis Bank. All of it was shattered when surprises sprung from an unexpected front. The Reserve Bank of India (RBI), as part of its risk-based supervision exercise for FY17, has highlighted divergence in provisioning for loan assets made by the bank. And, as required by the RBI, Axis Bank provided Rs 1,315 crore for the same. With this divergence provided for in September quarter (Q2), the bank's results missed the Street estimates by a significant margin. Even as net profit in Q2 rose by 36 per cent year-on-year to Rs 432 crore, analysts aren't pleased. Loan loss provisioning after moderating to Rs 2,342 crore in June quarter, rose by 34 per cent sequentially in Q2 to Rs 3,140 crore. Provisioning worth Rs 505 crore due to loans referred to Insolvency and Bankruptcy Code (IBC) also elevated the provisioning. The only point to suggest that perhaps ...