Date:
November 12, 2008
Ref. No. MPML/BB/194/056/2008
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Dear Sir, We
would like to inform you that market is moving side ways currently
it is trading at 9700 levels. September IIP numbers are at 4.8%
Vs 1.3% in August and Vs 6.9% (YoY). In this falling market banking
sector looks safe bet as govt. is taking good step to strengthen
the banking sector. RBI has cut the Cash Reserve Ratio
(CRR) by 100bp to 5.5% from its current level of 6.5%. In
view of the ebbing of upside inflation risks coupled with concerns
of slower growth, RBI has further reduced the repo rate
by 50bp to 7.5% from November 3. We expect banks to reduce
both lending and deposit rates. Hence we suggest you to invest
in Best performing bank, Axis bank.
Axis
Bank reported Rs.4 billion of net profit for Q2FY09, far ahead
of our expectations. The robust earnings performance has been
driven by better than expected Net Interest Income (NII) and
other income. The NII has grown by 55.2% yoy, while other
income grew by 81.4% yoy. The operating profit grew
88.9% yoy to Rs 8.7 billion led by robust growth in the operating
income.
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