Kotak Mahindra Bank Q2 Results: Standalone profit slips 7%, asset quality improves

In line with D-street’s expectations, India’s third-largest private lender Kotak Mahindra Bank’s profit after tax slumped, while net interest income grew marginally year-on-year basis, however, the asset quality improves sequentially in the second quarter of the financial year 2021-22 (Q2FY22).

On a standalone basis, Kotak Bank’s profit came at Rs 2,032 crore, down 7 per cent YoY in Q2FY22 as compared to Rs 2184.5 crore in the same quarter a year ago, while NII stood at Rs 4,020.6 crore, up 3.2 per cent YoY in Q2FY22 as compared to Rs 3897.5 crore in the corresponding quarter a year ago.  

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Similarly, the Net Interest Margin (NIM) for the quarter on September 30, 2021, stood at 4.45 per cent, the bank said in its results statement.

Kotak Bank in its results release further said, “As at September 30, 2021, GNPA was 3.19 per cent and NNPA was 1.06 per cent. Credit cost on advances was 63 bps (annualized) for Q2FY22 (133 bps for Q1FY22).”

Customer assets, which includes Advances and Credit substitutes, increased by 17 per cent to Rs 256,353 crore in Q2FY22 from Rs 218,790 crore in the same quarter a year ago. While Advances increased by 15 per cent to Rs 234,965 crore versus Rs 204,845 crore YoY, the bank reported.

Similarly, CASA (current and savings account) ratio during the July-September quarter stood at 60.6 per cent as compared to 57.1 per cent in the same quarter a year ago, according to the bank’s release.

COVID-related provisions as of September 30, 2021, were maintained at Rs 1,279 crore, the bank said adding further that it has implemented a total restructuring of Rs 495 crore for Individuals and Small Businesses loans in Q2FY22, while total restructuring of Rs 767 crore for MSMEs in Q2FY22.

Immediate after the earnings announcement, the shares of Kotak Bank jumped around 4 per cent to Rs 2238.5 per share on the BSE, while at around 02.22 pm, the counter is trading over 3 per cent higher to Rs 2226.3 per share as compared to 0.48 per cent rise in the S&P BSE Sensex on Tuesday.