Axis Bank Ltd. Under Pressure Despite 38% Q2 Profit Growth

Axis Bank reported a 37.6% year-on-year increase in standalone net profit to ₹7,003 crore for Q2 FY27, compared with ₹5,090 crore in the corresponding quarter last year. Net interest income (NII) rose 11.8% to ₹15,371 crore, supported by strong credit growth and lower provisions. However, the bank’s profit was slightly below market expectations, raising concerns among investors. The bank’s advances grew 23% year-on-year, while deposits increased approximately 21%. Asset quality improved, with the gross non-performing asset (GNPA) ratio declining to 1.16% from 1.28% in the previous quarter. However, net interest margin stood at 3.36%, while other income declined 1.4% to ₹6,531 crore, partly reflecting pressure on treasury income. Despite the improvement in earnings, Axis Bank shares fell by as much as 5% on October 19, 2026, as investors focused on the earnings shortfall, margin trends and weaker other income. Going forward, investors will monitor deposit growth, funding costs, operating expenses and asset quality to assess whether the bank can sustain profitability and improve its overall financial performance.