December , 2020
16:09 pm

Nandini Dasgupta



Axis Bank Limited is the third largest private sector bank in India. It was founded in 1993 as UTI Bank with its headquarters in Mumbai and one of the first new generation private sector banks to begin operations in 1994 through its first branch in Ahmedabad. The Bank offers the entire spectrum of financial services to customer segments covering Large & Mid-Corporates, MSME, Retail and Agriculture Businesses. The bank was promoted jointly by the Administrator of the Unit Trust of India (UTI), Life Insurance Corporation of India (LIC), General Insurance Corporation, National Insurance Company, The New India Assurance Company, The Oriental Insurance Corporation and United India Insurance Company. Presently, it has 123 institutional owners and shareholders through Securities Exchange Commission (SEC). As on 31st March 2020, the Bank has a large footprint of 4528 domestic branches (including extension counters) with one of the largest ATM networks in India (12000+) along with eleven international offices, including an overseas subsidiary at London. Their global depository receipts are listed on the London Stock Exchange. Few years back, it launched an innovation lab facility to accelerate new technology solutions for the banking sector by working closely with the start-ups that are redefining banking in the digital era.


India’s banking sector is sufficiently capitalised and well regulated. Credit, market and liquidity risk studies, suggest that Indian banking industry has traditionally withstood global downturn and turmoil well.

As of FY20, total credit extended by the banks in India surged to US$ 1,936.29 billion (approx). During FY16 – FY20, deposits of the banks grew at a CAGR of 6.81%. 

Improved and continuous economic reforms are expected to provide added impetus to growth in the banking sector of our country as rapidly growing businesses will turn to banks for their credit needs. 

The advancement in technology has brought mobile and internet banking services to the forefront. The banking industry is now laying greater emphasis on upgrading their technology infrastructure to enhance customer’s overall experience thereby increasing their competitive edge. India’s digital lending is estimated to reach US$ 1 trillion (approx) by FY23 driven by the increase in digital disbursements.



The Government of India and the RBI have acted speedily to offset the impact of pandemic related disruption. Policy repo rates were reduced and relief on debt servicing was granted by permitting moratorium on terms loans and deferment of interest on working capital facilities. 

During these hard times, Axis has proactively strengthened the operational and technological infrastructure needed; to ensure continuity of normal operations along with large-scale ‘work from home’ mandate and maximum functioning of ATMs and branches.

In fiscal 2020, they have successfully raised 12,500 crores of capital through one of the largest ever Qualified Institutional Placement issues by a private sector issuer; which strengthened the Bank’s capital ratios, with total adequacy of 17.53% and common equity tier 1 ratio of 13.34%. The operating profitability in fiscal year 2020 continued to remain steady with 16% growth in net interest income and 23% growth in operating profits. The company has consistently declared dividends for the last 5 years.

Healthy financials, use of innovative technology, full service basket and an overall bullish sector, all point towards Axis Bank Limited being a good stock to buy. 






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