On 28 January 2022, Kotak Mahindra Bank informed the public of a rise in net profit to Rs. 2,131 crores which was a tad above the analysts’ expectation of Rs. 2,073 crores. This also happens to be a 15% year-on-year increase in net profit.
To know more details about this story, read below.
Key Highlights of this Story
The reason this bank surpassed expectations is because of the reversal of provisions amounting to around Rs. 131 crores. Rs. 100 crores was set aside for COVID-19 related emergencies.
The difference in the interest income and the interest paid to those depositing money with this bank rose to 12% year-on-year to Rs. 4,334 crores. Dalal Street had recommended the amount as Rs. 4,474.7 crores.
Moreover, this lender’s margin has Dalal Street surprised as it came in at 4.62% against a prediction of 4.45-4.5%.
However, operating profit declined to Rs. 2,701 crores, which is 7.1% year-on-year.
Asset Quality Performance of Kotak Mahindra Bank
This bank’s assets have shown a strong improvement. The gross non-performing assets stood at 2.71% to 3.19% of the previous December quarter.
Moreover, the net NPA ratio has lowered from 1.06% to 0.79%. Further, the provision coverage ratio rose from 63% to 71% in the similar quarter of the past year. Presently, this bank holds COVID-19 related provisions of Rs. 1,000 crores.
Kotak Mahindra had reported that it would get firmer on loan growth and customer additions in the upcoming quarters. According to this bank, it has added 2.1 million new customers in 2021 against the 8,00,000 fresh additions of the previous year. To know more about whether you should invest in Kotak Mahindra, do study thoroughly about the bank and get a fair idea of its visions and financial history before doing so.
Frequently Asked Questions
What are the total provisions of the bank?
Ans. Kotak Mahindra Bank’s total provisions are to the tune of Rs. 7,269 crores.
What was the bank’s slippage?
Ans. Kotak Mahindra Bank’s slippage was at Rs. 750 crores against the recoveries of Rs. 1,086 crores.
What was the share price of Kotak Mahindra Bank on the NSE?
Ans. Shares of Kotak Bank were at 1.6 per cent at Rs. 1,919.90 on the National Stock Exchange.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.