Axis Bank shares rose 4.04 percent to an intraday high of Rs 1,216.90 on the NSE on Thursday, recovering from two consecutive sessions of decline. The rally followed the bank’s September quarter results, which showed improved asset quality, lower credit costs, and stable net interest margins.

According to data from LSEG, at least eight of the 40 brokerages tracking Axis Bank revised their price targets upwards. HSBC analysts highlighted “substantial improvements, including credit cost decline and better-than-estimated net interest margin resilience,” raising their target price to Rs 1,460 from Rs 1,340. Jefferies also increased its target to Rs 1,430 from Rs 1,370 while maintaining a “buy” rating.

Despite a sharper-than-expected drop in quarterly profit, the bank saw total deposits grow 11 percent year-on-year, and net interest margins fell only 7 basis points sequentially to 3.73 percent, better than the 20-basis-point decline analysts had anticipated.

The positive performance of Axis Bank supported the Bank Nifty index, which rebounded past 57,000. Analysts at Choice Broking identified resistance at 57,100–57,200, suggesting a potential breakout towards 57,500. Axis Bank was the top gainer on the index, followed by Kotak Mahindra Bank (+2%), Punjab National Bank, HDFC Bank, ICICI Bank, and IndusInd Bank.

Investor sentiment in the banking sector was further strengthened by reports of a possible public sector bank consolidation, with the government reportedly planning mergers of smaller lenders with larger state-run banks.