Nomura Sees Gradual Margin Recovery at Axis Bank
Nomura analysts expect Axis Bank's margin to recover more slowly than management anticipates. The brokerage keeps a buy rating and cuts its target price to 1,525 rupees.
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what happened
According to Market Talk, Nomura analysts expect Axis Bank's net interest margin to recover only gradually from the January-March quarter. Management anticipates sequential improvement, but Nomura believes the Reserve Bank of India's October repo rate hike will reprice loans with a delay. The analysts say margins for fiscal 2028 depend on further rate increases.
Nomura raised its fiscal 2027 loan growth forecast to 21% from 17%. It cut fiscal 2027 and 2028 earnings per share estimates by 2% and 4%, citing lower treasury and fee income. The brokerage maintains its buy rating and lowered its target price to 1,525 rupees from 1,545 rupees. On Monday the shares fell 3.9% to close at 1,236.90 rupees.
why it matters
The note suggests that pressure on Axis Bank's margins could last longer than management expects, and that earnings partly depend on future RBI rate decisions. The view matters for investors in Indian bank stocks and the Nifty Bank index.
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sources
- Axis Bank's Margin Recovery Likely to Be Gradual — Market Talk, 20 October 2026 at 03:38 UTC
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