NII is likely to rise around 4% year-on-year, led by steady loan growth. However, net interest margins (NIMs) are expected to contract by about 9 basis points sequentially to 4.56%, as the impact of interest reversals remains limited due to better asset quality.
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Kotak Mahindra Bank |
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|
Standalone ₹cr |
2QFY25 |
1QFY26 |
2QFY26F |
QoQ |
YoY |
|
SO |
7,020 |
7,259 |
7,294 |
0% |
4% |
|
NIMs likely to decline 9bp QoQ to 4.56% vs 4.65% |
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|
Other Inc |
2,684 |
3,080 |
2,890 |
-6% |
8% |
|
PPOP |
5,099 |
5,564 |
5,337 |
-4% |
5% |
|
Provisions |
660 |
1,208 |
983 |
-19% |
49% |
|
Reported Credit cost likely to decline 20bp QoQ to ~0.7% |
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|
PAT |
3,344 |
3,282 |
3,272 |
0% |
-2% |
Cost ratios are expected to stay contained, leading to a 5% year-on-year increase in pre-provision operating profit (PPOP).
Reported credit costs are seen easing by 20 basis points quarter-on-quarter to around 0.7%, after having risen sharply in the previous quarter. Overall, PAT is projected to dip marginally by about 2% year-on-year.Key factors to watch out for:
– Management commentary on asset quality, particularly in the retail and commercial vehicle segments
– Any updates on growth strategy. Investors will also look for insights into the bank’s unsecured loan expansion plans, which Kotak earlier said it aims to grow by roughly 15% over the medium term.
– Any guidance on NIM trajectory, given management’s earlier indication that margins could bottom out in Q2.
