Axis Bank Q1 FY26 Results: Market Reaction and Financial Snapshot

Market Performance

Axis Bank shares dropped 7.4% in early trade on Friday to ₹1,073.95 before recovering to ₹1,109.90 by 9:25 AM (down 4.31% intraday). Despite recent weakness, shares are up 12% in six months and 157% over five years, but remain 15% lower year-on-year.

Q1 FY26 Earnings: Key Highlights

• Net Interest Income (NII): Rose marginally by 0.8% year-on-year to ₹13,560 crore (from ₹13,448 crore in Q1FY25).
• Net Profit: Declined 3.8% year-on-year to ₹5,806.14 crore, compared to ₹6,034.64 crore in Q1FY25.
• Net Interest Margin (NIM): Fell to 3.80% in Q1FY26, down from 3.97% in Q4FY25 and 4.05% in Q1FY25.
• Asset Quality:
  • Gross NPA ratio increased to 1.57% as of June 30, 2025 (from 1.28% in the previous quarter).
  • Net NPA ratio rose to 0.45%, up from 0.33% in Q4FY25.
  • The rise in NPAs means the bank has more loans at risk of not being repaid, which can lead to higher credit costs, lower profitability, and increased provisions. This deterioration in asset quality raises concerns about future earnings and stability, contributing to negative market sentiment.

Historical Share Price Movement:

• 1 Month: -8%
• 6 Months: +12%
• 1 Year: -15%
• 3 Years: +63%
• 5 Years: +157%

Historical Share Price Movement

Summary

Axis Bank’s share price plunged post-earnings on weaker profit growth, shrinking margins, and rising NPAs. Despite a slight NII increase, asset quality concerns now overshadow long-term gains. The near-term outlook remains challenged by ongoing margin and credit pressures.