Axis bank reported last week and it really impressed us with its results. The day they have released their results they have not stopped their uptrend. Here are the few numbers for this quarter.

2nd Quarter 2015 Half yearly 2015
Interest earned 8602.36 16,891.78
Other income 1,947.61 3,638.66
Interest expended 5077.51 10,056.44
Operating Expenses 2,310.16 4,416.04
Deposits 2,83,727.57
investments 1,14,283.75
Advances 2,42,198.06

 

Banking business is all about lending and deposits. In the last six months Axis Bank had earned 6.97% from its lending business. Same time they have paid interest on their deposits of 3.54%. They also made 3.18% so far through investments. In short they made net 2.14% on their deposits in the last 6 months.

In the last one year they have grown their deposits by 11%, their lending book by 20% and investment book have fallen down by 3%.

They are expected to report their returns on equity for the year end 2015 around 15% – 17%. We calculated its intrinsic value for the 2014 in range of Rs 240 – Rs 260. We do expect its intrinsic value for the year end 2015 in the range of Rs 265 – Rs 295 and in range of Rs 325 – Rs 365 for the year 2016.

They are trading at premium price today and we do own a good amount of stocks of it. Our strategy at this point is to hold.