20 January 2020 KMBs third-quarter result mirrored overall slowdown in the economy, which led to moderation in loan growth and elevated slippage trajectory. Overall operating performance was healthy with PPoP increasing by 23% YoY, despite the bank making INR2b provisions toward pension obligations. We cut our EPS estimate for FY21/22 by 4%/7%, primarily as we factor in lower loan growth assumption. Maintain Standalone PAT increased 24% YoY to ~INR16b (4% miss v/s our estimate of NII grew ~17% YoY to INR34.3b (2% miss), impacted by moderate loan growth; however, margins improved 8bp QoQ to 4.7%. Opex increased 21% YoY to INR23.8b, led by one-off of INR2b toward pension obligations. Thus, the C/I ratio came in at 49.9% v/s 45.2% in 2Q. Loan book grew ~10% YoY to INR2.2t, reflecting the slowdown in the business banking/corporate banking and CV/CE portfolios. Deposits growth moderated to 12% YoY to INR2.4t, albeit term deposits grew by 5% YoY.