Kotak Mahindra Bank Q4 Results: Net profit falls to Rs 3,552 crore, declares dividend Rs 2.50 per share

Kotak Mahindra Bank

Kotak Mahindra Bank on Saturday reported a 14% year-on-year decline in standalone net profit for the March quarter. The private sector lender posted a standalone net profit of Rs 3,552 crore for Q4 FY25.

Provisions and contingencies during the quarter rose more than threefold to Rs 909 crore, reflecting the bank's cautious approach to asset quality.

Despite the spike in provisioning, Kotak’s asset quality improved marginally. Its gross non-performing asset (GNPA) ratio stood at 1.42% as of March 31, 2025, compared to 1.50% at the end of December 2024.

Loan growth remained robust, with advances rising 13% year-on-year, while deposits grew 15% during the quarter.

Additionally, its Net interest income (NII) increased 5% to Rs 7,284 crore. However, the bank’s net interest margin (NIM) contracted to 4.97% from 5.28% a year ago. Sequentially, NIM showed a slight improvement from 4.93% in the December quarter.

The pressure on margins is attributed to a large portion of the bank’s loan book being linked to external benchmarks. In a declining interest rate environment, lending rates adjust quickly to RBI rate cuts, while deposit rate adjustments typically lag, squeezing margins temporarily.

The board has announced a dividend of Rs 2.50 per share.

In February, the Reserve Bank of India lifted a 10-month restriction on Kotak Mahindra Bank that had barred it from issuing new credit cards and onboarding customers digitally due to gaps in its IT systems.

On Friday, Kotak Mahindra Bank shares closed 0.95% lower at Rs 2,185 on the BSE.