Kotak Mahindra Bank saw its share prices jump nearly 5% on Monday after reporting better-than-expected results for the fourth quarter of the fiscal year. The leading private sector lender's consolidated net profit climbed 22% to Rs 18,213 crore, fueled by strong loan growth and lower provisions.
The Mumbai-headquartered bank posted an 18% rise in standalone net profit to Rs 4,133 crore for the January-March period. While net interest income grew 13% to Rs 6,909 crore, narrowing net interest margins limited further growth. Total advances increased 20% during the quarter with robust demand across retail, commercial and rural segments.
Investors cheered the strong earnings performance, sending Kotak Bank shares up 4.85% to close at Rs 1,622.35 on the BSE. On the National Stock Exchange, the scrip jumped 4.90% to end the day at Rs 1,622.50. This made Kotak Mahindra Bank the top gainer among key index constituents.
During an earnings call, CEO Ashok Vaswani assured that a recent RBI directive related to new customer onboarding will have minimal financial impact. He estimated it could reduce profit before tax by Rs 300-450 crore for the current fiscal year. This statement helped alleviate concerns around rising regulatory oversight of the lender.
In summary, Kotak Bank's latest results indicate a steady recovery in business activity post the third wave of the pandemic. Strong credit growth and stable asset quality provides confidence that profitability will continue increasing in the coming quarters.
