Axis Bank gains after Macquarie upgrades, hikes target price by 22%

Macquarie increased its target price to Rs 925 from Rs 760 to factor in capital raise and higher valuation multiple on lower credit costs

Axis Bank shares gained 0.4 percent intraday on June 26 after global research firm Macquarie upgraded the stock to outperform from neutral and raised target price by 22 percent.


The brokerage increased its target to Rs 925 from Rs 760 to factor in capital raise and higher valuation multiple on lower credit costs.

"Bank is focusing on the de-risking balance sheet and improving the relationship with corporates and we like this new Axis Bank and will keenly watch for return on assets improvement," Macquarie said.

In addition, while maintaining neutral call on the stock, JPMorgan also hiked target price to Rs 850 from Rs 720, implying 9 percent potential upside from current levels.

The franchise has levers to deliver on return on equity guidance and execution remains key, the brokerage said, adding credit cost normalization is likely to be gradual and margin improvement can be difficult.

The stock was one of the biggest gainers in last one year, rising 52 percent. It was quoting at Rs 783.45, up to Rs 1.60, or 0.20 percent on the BSE at 0918 hours IST.

Disclaimer: The views and investment tips expressed by brokerages on moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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