Over the last few years, Kotak Mahindra Bank has proven undoubtedly its competitive edge over the other private banks through higher fee income generation capability, well managed asset quality and well handled other financial business subsidiaries. As a result, stock has traded at a premium to its peers despite having lower return ratios. However, we expect some negative surprises on asset quality and profitability in FY16E post the merger with ING Vysya Bank. Consequently, we maintain our NEUTRAL view on the stock with a Fair Value of Rs706 (wherein the merged entity has been valued at 4x FY17E adjusted BV and...