According to reports from The Hindu BusinessLine, Axis Bank is weighing options to bolster its wholly-owned subsidiary Axis Finance's capital, including a combination of capital infusion from the bank itself as well as getting in a strategic partner. A top management team official confirmed that by getting in a strategic partner, the bank can dilute its equity stake in the subsidiary and raise some capital for it. There is also a possibility that the subsidiary can fund its future growth by deleveraging.
As Axis Bank evaluates these strategic options, the bank's shares are currently trading at ₹1,260.10 as of January 23, 2026, representing a 2.72% decline from the previous closing price of ₹1,295.35. The bank maintains a robust market capitalization of ₹3,92,847 crore and enjoys strong analyst support with 15 strong buy ratings and 16 buy ratings out of 39 total analyst coverage, reflecting confidence in the bank's strategic direction.
The aforementioned plan comes in the wake of RBI lifting the proposed bar mentioned in RBI's October 2024 Draft Circular - Forms of Business and Prudential Regulation for Investments, on overlap in the businesses undertaken by a bank and its group entity. Axis Finance is Axis Bank's wholly-owned Non–Banking Finance Company (NBFC) subsidiary that offers loans to corporates, MSMEs and retail customers.
According to the RBI's (Commercial Banks – Undertaking of Financial Services) (Amendment) Directions, 2025, as a principle, any form of business shall be undertaken by one entity in a bank group. However, if a bank undertakes a form of business through more than one entity in a bank group, the same shall be done with proper rationale such as business segmentation/specialisation, duly recorded and approved by the Board of the bank.
In case lending business is undertaken through a group entity also, additional conditions shall be applicable to such a group entity (NBFCs including HFCs) including regulations as applicable to Upper Layer NBFC other than the requirement for listing, irrespective of whether the NBFC has been specifically identified by the Reserve Bank as Upper Layer or not. The listing requirement shall be complied with by those NBFC group entities which are identified by the Reserve Bank as Upper Layer.
Referring to the RBI's Forms of Business Circular, the Axis Bank official said: "All options are on the table...." The bank appears to be evaluating comprehensive strategies to ensure compliance with new regulatory requirements while optimizing capital allocation for its NBFC subsidiary. With the bank's 52-week high at ₹1,326 and strong institutional backing including 33.48% mutual fund holding and 42.57% FII holding, Axis Bank is well-positioned to execute its chosen capital strategy for Axis Finance.
