Kotak Mahindra Bank Q2 Review - Well Positioned For Earnings Pick-Up: Axis Securities
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Axis Securities Report
The key positives for Kotak Mahindra Bank Ltd. in Q2 FY22 was strong pick up in loan growth (up 14.7% YoY/ 8%) coupled with stable asset quality resulting in earnings growth of 23.8% QoQ to Rs 203.2 billion.
Loan growth was spread across segments led by mortgages and unsecured book (up more than 10%).
Net interest margin slowed down to ~4.45% from 4.6% QoQ.
Gross /Net non-performing assets came down ~40/20 basis points to 3.2%/1.1% with gross slippage ratio of ~1.9%.
Credit costs declined to ~60 bps of loans. Restructured book is also moderate at ~54 bps.
With the push on growth, Kotak Mahindra Bank's cost-income has increased to 46.5% from 43.5% QoQ and 38.5% YoY which led to moderate pre-provision operating profit growth.
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