Valuation gap with peers is expected to narrow for Axis Bank

It is leveraging the digital ecosystem, focusing on acquisition of corporate salary accounts, and also cross-selling products to existing clients

Axis Bank has strengthened its positioning -- on both the assets and liability side -- and it may be set to deliver sustained improvement in performance. The valuation gap between Axis Bank (which trades at 1.4x core book value (or BV) and peers like ICICI Bank (valued at 2x BV) is expected to narrow.
 

Axis has started gaining market share on current account savings account or CASA (where its growth rate of 14 per cent comfortably beats aggregate industry growth rate of 10 per cent). The CASA ratio is at 44 per cent (up 100 basis points (bps) quarter-on-quarter or