Axis Bank Q2 profit declines 26% YoY to ₹5,090 crore; asset quality improves slightly

Axis Bank Ltd. reported a 26% year-on-year decline in net profit to ₹5,090 crore for Q2 FY26, missing Street estimates, primarily due to higher provisions and slower treasury income. However, total income rose 1% YoY to ₹37,595 crore, supported by stable growth in core banking operations. The bank’s asset quality showed a mild improvement, with the gross NPA ratio easing to 1.41% from 1.43% in the previous quarter, and net NPA improving to 0.31%. Provisions stood at around ₹1,200 crore, indicating continued prudence in credit risk management. On the fundamentals side, Axis Bank remains well-capitalized with a Capital Adequacy Ratio (CAR) of 16.9% and a return on equity (ROE) near 13%. The net interest margin (NIM) stayed steady at 4.1%, reflecting healthy lending spreads. The stock traded around ₹1,120, down 1.3% intraday, with a market capitalization of over ₹3.4 lakh crore. Despite the profit dip, analysts remain constructive on Axis Bank’s long-term outlook, citing strong retail loan growth, improving asset quality, and digital expansion as key positives. Axis Bank’s focus on operational efficiency and risk management continues to position it as one of India’s leading private sector lenders with resilient fundamentals.