Kotak Mahindra Bank Q4 preview: Strong earnings growth, stable NIM likely; all eyes on asset quality

NEW DELHI: Kotak Mahindra Bank is expected to release a strong set of quarterly figures, with double-digit profit and NII growth. Margins are expected to increase year over year. All eyes would be on asset quality for the SME segment, other unsecured portfolios and the restructured portfolio.

Emkay Global sees the private lender’s stand-alone profit rise 21.6% year-on-year to Rs 2,045 crore from Rs 1,682.40 crore in the prior year quarter. NII is expected to grow by 14.9% year-on-year to Rs 4,415 crore from Rs 3,842.80 crore in the same quarter last year. The NIM margin is expected to increase 23 basis points to 4.6% from 4.4% in the prior year quarter.

“Mortgage growth momentum remains strong, but CV is lackluster. Margins may remain flat QoQ. Slippages will remain largely flat sequentially,” he said.

Sharekhan expects autonomous profit to rise 46.6% year-on-year to Rs 2,466 crore. It sees NII climbing 27.3% YoY to Rs 4,894 crore. NIM is seen at 4.5 percent.

On a consolidated basis, YES Securities expects Kotak Mahindra Bank to report a 10.9% YoY increase in profit to Rs 2,831.60 crore on a 19.2% YoY increase in revenue net of interest (NII) at Rs 5,982.40 crore. Pre-provision operating profit is expected to fall by 6% to Rs 4,302 crore.

“Slippages are expected to decline sequentially due to underlying factors. Net interest margin is expected to be slightly higher on a sequential basis due to the increased share of unsecured retail lending. fees would only be marginally higher due to low card fees, higher bond yields, provisions would be sequentially higher,” he said.

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