HDFC Securities Institutional Research's Darpin Shah and Shivraj Gupta released a note on Axis Bank today with a Buy rating and a Rs 630 price target. The analysts gave four driving reasons for the rating:

1. Gross impaired asset additions expected to increase QoQ; however maintained its guidance of Rs 65 billion for FY15

2. Exposure to leveraged companies have declined gradually to form ~7% of total loans vs. 10% over the trailing five quarters

3. 60% of power exposures to be operational in FY15 and rest 40% expected to be operational over FY16-17

4. NIM to remain healthy in a tight band with a focus on high yield loans. Base rate cut to be in smaller quantum

5. In FY16, Retail traction to be higher vs. SME & Corporate segments; overall loans expected to grow at 18-20%. Upgrade net earnings by ~3-5% for FY16-17E. Maintain Buy. Revise TP to Rs 630.

Shares of the bank gained Rs 2.75, or 0.49%, to trade at Rs 559.50. The total volume of shares traded was 112,782 at the BSE (10.49 a.m., Monday).

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