Axis Bank Share Price Jumps 4% as Asset Quality Improves, Slippages Narrowed in Q2 FY26 Results

Axis Bank core income and retail disbursements showed resilience. The management remains optimistic about the impact of recent policy changes on future growth.

Stable Core Income and Retail Momentum

The bank’s Net Interest Income (NII) rose 2% year-on-year to ₹13,745 crore, compared to ₹13,483 crore in Q2 FY25. Managing Director & CEO Amitabh Chaudhry highlighted positive trends in retail lending and corporate loan growth.

He added that GST and CRR cuts are expected to boost liquidity and lending activity over time.

Axis Bank’s Rising Provisions and Asset Quality Metrics

Total provisions and contingencies jumped 61% to ₹3,547 crore, up from ₹2,204 crore a year ago. According to CFO Puneet Sharma, the additional standard asset provision is expected to be written back by March 31, 2028, or upon loan closure.

The gross NPA ratio rose slightly to 1.5% from 1.4% last year, while net NPA stood at 0.4% versus 0.3% previously. Gross slippages came in at ₹5,696 crore, lower than ₹8,200 crore in Q1 FY26 but higher than ₹4,443 crore in Q2 FY25.

Margins Narrow Amid Sectoral Shifts

Axis Bank’s domestic Net Interest Margin (NIM) declined to 3.8% from 4.1% a year earlier. The moderation reflects changes in the bank’s lending mix and broader sectoral trends. However, the bank continues to focus on improving operational efficiency to support margins.

Axis Bank Q2 FY26 Results One-Time Provisions Weigh on Profit

For Q2 FY26, Axis Bank posted a net profit of ₹5,090 crore, down from ₹6,918 crore in the same quarter last year. The decline was largely attributed to standard asset provisions of ₹1,231 crore, following RBI’s FY25 inspection related to discontinued crop loan variants.

Axis Bank Share Price Performance

Axis Bank’s stock traded 4% higher at ₹1,217.65 at 9:35 AM on the NSE. 

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Conclusion

Despite a sharp dip in quarterly profit due to one-time provisions, Axis Bank’s core operations remain stable, backed by steady NII growth and healthy retail disbursements. 

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