Axis Bank Q2 Results October 17, 2026: Profit Up 38% to ₹7,003 Crore but Misses Estimates

Axis Bank Q2 results came out on Saturday, October 17, 2026, and the headline is a big one. Standalone net profit jumped 38% year on year to ₹7,003 crore for the July to September quarter, up from ₹5,090 crore, according to the press release and investor presentation the bank filed with NSE. Look closer, though, and much of that jump comes from a soft base and lower provisions, not a surge in core earnings.

Axis Bank Q2 results October 17: the key numbers

All figures are standalone for the quarter ended September 30, 2026 (Q2 FY27), against the same quarter last year unless we say otherwise.

• Net interest income (NII): ₹15,371 crore, up 12% from ₹13,745 crore, and up 5% from the June quarter.
• Net interest margin (NIM): 3.36%. Excluding the impact of FCNR(B) deposits, the bank puts it at 3.47%.
• Operating profit: ₹11,083 crore, up 6%. Core operating profit, which leaves out trading income, rose 11% to ₹10,998 crore.
• Fee income: ₹6,381 crore, up 6%. Trading income shrank to ₹85 crore from ₹498 crore, so total other income slipped 1% to ₹6,531 crore.
• Operating expenses: ₹10,819 crore, up 9%.
• Provisions and contingencies: ₹1,694 crore, against ₹3,547 crore a year ago.

Why the 38% needs a footnote

The year-ago quarter carried an additional one-time standard asset provision of ₹1,231 crore, which the investor presentation flags in its provisions table. That’s a big reason total provisions fell by about half this time, and why profit growth looks so much stronger than the 11% rise in core operating profit. Specific loan loss provisions also came down, to ₹1,564 crore from ₹2,133 crore.

Analysts wanted a little more. On average they had expected a profit of ₹7,124 crore, according to LSEG data cited by Reuters in Business Standard, so the reported number was a narrow miss. Reuters blamed higher operating expenses and weaker other income, as rising bond yields and a volatile rupee hurt treasury income.

Margin takes a hit from FCNR deposits

The margin was the soft spot. NIM fell to 3.36% from 3.46% in the June quarter, and the bank’s own margin walk attributes 11 basis points of the drop to FCNR deposits. The press release says Axis raised ₹1,018 billion of FCNR(B) deposits. We saw the same FCNR effect weigh on margins in the ICICI Bank Q2 results announced the same day.

Loans, deposits and bad loans

Balance sheet growth was strong. Advances rose 23% to ₹13,73,727 crore, and 9% from June. Retail loans grew 16% to ₹7,39,905 crore and make up 54% of net advances, while corporate loans grew 34% and SME loans 25%. Month-end deposits rose 21% to ₹14,52,066 crore, with term deposits up 27%. The CASA ratio, the share of cheap current and savings account money in total deposits, stood at 36% on a month-end basis.

Asset quality kept improving. The gross NPA ratio fell to 1.16%, from 1.46% a year ago and 1.28% at the end of June. Net NPA was 0.35%, down from 0.44%. Gross slippages, the fresh bad loans of the quarter, dropped to ₹4,762 crore from ₹5,566 crore in the June quarter and ₹5,696 crore a year earlier. Provision coverage held at 70%, and the annualised net credit cost came in at 0.45%.

Capital looks comfortable, with a CET-1 ratio of 14.61% and a capital adequacy ratio of 16.27%.

Our read

Take out the soft base and this is a decent quarter rather than a spectacular one. Core operating profit grew 11%, loans grew a touch faster than deposits, and bad loans kept shrinking. The weak spots are the margin, the thin trading line and the slight miss on estimates. With results out on a weekend, the next trading session is the market’s first chance to react.

Our guide on how to analyse quarterly results of a company walks through NII, margins and NPAs, and the CASA ratio explainer covers why low-cost deposits matter so much for a bank’s margin.

This article is a news summary for information only and is not investment advice. Please consult a SEBI-registered adviser before making investment decisions.