Axis Bank falls after missing Q1 profit estimates

Shares of Axis Bank, India's third largest private sector lender, fell over 2 per cent in the early trade on Monday after it reported a 21 per cent drop in net profit at Rs 1,555.50 crore for the June quarter on account of a rise in bad loans.

The bank had earned a net profit of Rs 1,978.44 crore in the April-June quarter of last financial year. Gross NPA in absolute terms rose to Rs 9,553 crore this June quarter compared with Rs 4,251 crore at the end of June, 2015.

Total income of the bank improved to Rs 13,852.1 crore from Rs 12,234.41 crore in the same period last year.

"We believe these are challenging times for Axis Bank, as manifested in temporary lull in earnings. However, one must not ignore the sheer franchise strength that will enable the bank to deliver healthy normalised returns post this phase. We maintain a buy rating on the stock," Edelweiss Securities said in a note to clients.

At 9:34 am, shares of the bank were trading at Rs 526.20 apiece, down 2.11 per cent from its previous close on the Bombay Stock Exchange ( BSE).