Axis Bank shares plunged over 7% on July 18, 2025, after the private lender reported disappointing Q1 FY26 earnings. The stock opened with a sharp gap down at ₹1,074, compared to its previous close of ₹1,159.85 on the BSE, and hit an intraday low of ₹1,073.95. On the NSE, it fell 6.36% to ₹1,086 per share.

It was the top loser on both Sensex and Nifty during morning trade.

At the time, the BSE Sensex was down 551.93 points at 81,707.31, while the NSE Nifty declined 164.65 points to 24,943.60.

📉 Axis Bank Q1 FY26 Results Highlights

  • Consolidated Net Profit: ₹6,243.72 crore
    ↳ Down 3% YoY, due to policy changes in NPA recognition and loan upgrades

  • Standalone Net Profit: ₹5,806 crore
    ↳ Lower than ₹6,034 crore (Q1 FY25) and ₹7,117 crore (Q4 FY25)

  • Net Interest Income (NII): ₹13,560 crore
    ↳ Up just 1% YoY

  • Net Interest Margin (NIM): 3.80%, down from 4.05% YoY

  • Loan Growth: 8% YoY (lagging behind overall banking sector growth)

🧾 What Hurt the Earnings?

The dip in profit was mainly due to a ₹614 crore technical hit, resulting from changes in how the bank classifies NPAs and account upgrades. Axis Bank voluntarily adopted more conservative asset recognition norms, aligning with a peer bank’s standards.

MD & CEO Amitabh Chaudhry said the change is part of a strategic shift towards prudent banking, and the long-term economic impact will be minimal.

CFO Puneet Sharma added that this decision followed an internal comparison with industry practices.

🧠 Should Investors Worry?

While the drop in profit and margins may cause short-term volatility, the bank’s conservative stance could strengthen long-term fundamentals. However, weak loan growth and falling NIMs remain points of concern.