LKP Research's research report on Kotak Mahindra Bank
Kotak Mahindra Bank (KMB) delivered a stable quarterly performance, supported by strong secured loan growth, improving asset quality, and disciplined cost management. While NIM contracted YoY due to rising funding costs and asset mix shifts, it improved sequentially as the bank took measures like savings rate cuts and focused on garnering low-cost deposits. Further, with stable cost-to-income (C/I) ratio and advanced provisioning, the resumption of growth levers like the credit card and 811 platforms post-embargo, should aid profitability going forward. With management guiding for growth at 1.5x–2x nominal GDP and strong execution of its strategic priorities—including acquisition of the Standard Chartered personal loan portfolio—KMB is well-positioned to accelerate earnings as macro conditions ease.
Outlook
Hence, we reiterate our BUY rating on the stock, with a Sum-of-the-Parts (SOTP)- based target price of ₹ 2,490.
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