This Article is From Apr 29, 2020

Axis Bank Shares Tumble Over 6% After Surprise March Quarter Loss

Axis Bank set aside more funds to cover a potential rise in non-performing assets - or bad loans - in a coronavirus (COVID-19)-hit economy.

Axis Bank Shares Tumble Over 6% After Surprise March Quarter Loss

Axis Bank shares fell to as low as Rs 427.50 on the BSE, as against their previous close of Rs 455.55

Axis Bank shares slumped more than 6 per cent on Wednesday, a day after the country's third largest private sector lender reported a surprise loss in the quarter ended March 31. Axis Bank's net loss came in at Rs 1,388 crore for the final quarter of financial year 2019-20, as against a net profit of Rs 1,505 crore in the corresponding period last year, as the lender set aside more funds to cover a potential rise in non-performing assets in an economy hit by the coronavirus (COVID-19) pandemic.

On the BSE, Axis Bank shares fell as much as 6.16 per cent to Rs 427.50 apiece, compared with their previous close of Rs 455.55.

Analysts had expected Axis Bank to post a net profit of Rs 1,556 crore for the March quarter, news agency Reuters reported citing Refinitiv data.

Axis Bank said it booked provisions of Rs 7,730 crore for the January-March period, including Rs 3,000 crore towards COVID-19. The provisions were nearly three times higher compared to the corresponding period a year ago. 

In a separate development, Axis Bank said on Tuesday that it will acquire a 29 per cent stake in Max Life Insurance for about Rs 1,590 crore, grabbing a seat among rival banks that already have a foothold in the country's life insurance industry.

At 9:57 am, the Axis Bank stock traded down 4.34 per cent at Rs 435.80 apiece on the BSE, underperforming the benchmark S&P BSE Sensex index which was up 0.97 per cent.