Q4FY23 Preview: Kotak Mahindra Bank: NII seen at Rs 5,976 crore, PAT at Rs 2,956 crore

27 Apr 2023 , 11:46 AM

Result date: 29^th April, 2023

Recommendation: Add

Target price: Rs 2,030

(Source: IIFL Research)

Riding high on loan growth of 20-22% and continued traction in mortgage and unsecured products, Kotak Mahindra Bank could post 32.2% growth in Net Interest Income (NII) over the year-ago quarter.

Net Interest Margin (NIM) could see improvement during the quarter. Factors such as favorable loan mix towards high-yielding products, flat cost ratios and strong liability franchise will aid NIMs and operating profit.

It could be another quarter of strong asset quality performance for the Bank. Overall, asset quality could remain stable and credit costs could normalize.

The Bank’s Profit After Tax or PAT could grow 6.9% as compared to the year-ago quarter.

Important management insights to watch out for:

• Sustainability of growth sustainability and transition, amid emerging macro challenges
• Outlook on NIMs 
• Stress in the SME book and other unsecured loans

Rs Crore	March 2023 estimates	YoY change	QoQ change
Net Interest Income (NII)	5,976	32.2%	5.7%
Operating Loss	4,114	23.2%	6.9%
Loss After Tax	2,956	6.9%	5.9%

Source: Brokerage estimates