Axis Bank shares trade choppy amid block deal buzz

Shares of Axis Bank witnessed volatile trade on Thursday amid a report that global private investment firm Bain Capital is likely to sell its stake in the private lender via a block deal today. The private investment firm may offload its stake worth $267 million at a floor price range of ₹966-₹977.70 per share. The offer price for the deal is at a discount of 1.2%-0% compared to Wednesday’s closing price.  

Bain Capital, which owns 1.3% stake in the bank, is likely to sell 0.7% stake in the private lender via block deal, as per the CNBC TV-18 report.

Reacting to the news, Axis Bank shares opened higher at ₹985 against the previous closing price of ₹977.75 on the BSE. Extending opening gains, the banking heavyweight rose to ₹988.15 mark, but soon pared gains and slipped to ₹974.15 level. At the time of reporting, the stock was trading at ₹975.85, down 0.2%, while the market capitalisation stood at ₹3 lakh crore. On the volume front, a total of 13,34,085 shares changed hands on the BSE and the NSE.

At the current price level, Axis Bank's share trade near its 52-week high of ₹989.50 touched on June 13, 2023, while it is up 57% against its 52-week high of ₹618.10 hit on June 23, 2022. The shares of the banking major have risen 50% in the last one year, while it added 4% in the six-month period. In the last one month, the banking stock has risen over 6%, whereas it gained nearly 1% in a week.

In the fourth quarter ended March 31, 2023, Axis Bank reported a net loss of ₹5,728 crore compared with a profit of ₹4,117.77 crore in the same period last year and ₹5,583.07 crore in the December quarter of FY23.

The interest income (NII) surged 33% year-on-year (YoY) to ₹11,742.2 crore as against ₹8,819.1 crore in the same period last year. The bank’s net interest margin (NIM) during the quarter under review stood at 4.22% up 73 basis points (bps) YoY. 

In the March quarter, the bank’s reported Gross NPA (non-performing assets) and Net NPA levels were 2.02% and 0.39% respectively as against 2.38% and 0.47% in the December quarter of FY23.

The board of the bank declared a final dividend of ₹1 per equity share of face value of ₹2 each (50%) for the financial year ended March 31, 2023, subject to approval at the ensuing 29th Annual General Meeting. Besides, the board also approved raising of capital up to ₹35,000 crore by issuing debt instruments in Indian or foreign currency from time to time.

This was the first financial earnings results by the bank after the acquisition of Citi Bank’s India business. In March this year, the Mumbai-headquartered bank completed the acquisition of Citibank’s India consumer and non-banking finance businesses, including credit cards, retail banking, wealth management, and consumer loans businesses. The deal includes Citi's consumer business from Citibank N.A. (CBNA) and its non-banking financial company, Citicorp Finance India (CFIL), comprising the asset-backed financing business, which includes commercial vehicle and construction equipment loans, as well as the personal loans portfolio.

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