(Bloomberg) -- Axis Bank Ltd.’s shares declined after the Indian lender’s first-quarter earnings missed estimates on worsening asset quality and elevated credit costs. At least five brokerages downgraded the stock.
The shares fell as much as 6.8% in early trading, the most since June 4. The lender reported 60 billion rupees ($717 million) in net income, lower than the average analyst estimate of 65 billion rupees.
The weakness in earnings came as Indian lenders struggle to garner deposits. Citigroup Inc. and Anand Rathi Securities were among the brokerages that downgraded the stock.
Axis Bank’s profit growth could be held back on more margin compression, with deposit costs likely to stay high amid more-intense competition, according to Bloomberg Intelligence analysts Sarah Jane Mahmud and Diksha Gera.
(Updates with stock price move and analyst comment in last paragraph)
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