Kotak Mahindra Bank Ltd. share price target

Kotak Mahindra Bank (KMB) reported tepid 3QFY21 results with the key pointers being: a) profitability (PAT declined 15.1% sequentially) dragged down because of higher provisioning b) Pro-forma NPA (GNPA/NNPA ratio of 3.27%/1.24%) marginally higher than expected c) sequential credit growth stood positive at 4.5% QoQ; with strong participation in ECLGS, d) sequentially higher cost to income ratio (42.3% v/s 38.5% in the previous quarter) driven by lower other income and higher opex., e) Higher provisioning expenses (6bn v/s 3.7bn in the previous quarter) led to sequential PAT de-growth; Covid provision stood 12.8bn as of 3QFY21, f) the total contingent provisioning (Covid + Standard + Specific) stood 1.08% of net advances, g) Total PCR (including Covid, general and specific provision) stood above...

Kotak Bank's (KMB) Q3FY21 PAT of Rs 18.5bn (+16% YoY) was backed by strong 29% growth in operating profit.

Valuation and Risks: We believe KMB is ready to grow as it has shifted its focus to asset side withemphasis on customer acquisition through organic or inorganic route by keepingan eye on risk.

September 2019. NII increased 16% to Rs 5051.85 crore, while other income moved up 27% to tax rate was higher at 25.06% in Q2FY2021, compared with 18.5% in Q2FY2020. Asset quality improves: The bank has improved the asset quality on consolidated as well as standalone basis, in the quarter ended September 2020....

Consolidated PAT came in at | 2946 crore, up 22.4% YoY, largely driven by bank's profit. Overall performance of subsidiaries remained healthy with Kotak Life insurance reporting profitability at | 171 crore, up 18.8% YoY. Kotak Securities PAT was healthy at | 199 crore, up 33.6% YoY. Kotak AMC profitability was at | 84 crore, flat YoY. Kotak Prime, the non-banking arm,...

We upgrade our rating from Hold to Buy with a revised target price of 1550 (SOTP basis).

KMB delivered a strong 27% YoY growth in earnings at Rs21.8bn (PLe: Rs14.9bn) which were much above ours and consensus estimates. Strong beat was on back of (i) continued NII traction of 17% YoY despite loan book flattish QoQ & -4% YoY (ii) recovery in fees (iii) higher treasury income (had not booked in Q1FY21) and (iv) substantially lower provisioning than expectations. Strong liability franchise build-up over the years has significantly benefitted funding cost which is now amongst the lowest in the industry, but growth has been quite selective as management continues to...

Kotak Mahindra Bank (KMB) reported a strong quarter with lower provisions and higher treasury income boosting earnings, even as core PPOP grew 19% YoY. The bank reported an uptick in fee income and margins too expanded 12bp QoQ, while loan growth stood flat. On the asset quality front, slippages stood lower (partially aided by the SC order), driving sequential improvement in asset quality ratios, while PCR increased sharply...

Kotak Bank's (KMB) Q2FY21 PAT at Rs 21.8bn (+27% YoY) beat estimates given strong 31% YoY operating profit growth and lower provisions.

Kotak Mahindra Bank (KMB) Q2FY21 numbers were strong with operational numbers beating expectations, stable asset quality (on a proforma basis) which were positives. Even on a proforma basis, GNPA would have been 2.70% and NNPA would have been at 0.74%; stable from Q1 levels), indicating better outlook Management indicated a shift of gears, to have higher focus on advances growth; with improving outlook (collection efficiency (for September at ~95%) is positive. We value standalone bank at ~3.9x its FY2023E book value and its subsidiaries at...