A brokerage firm CLSA upgraded its stance on Kotak Mahindra Bank to 'Outperform' from 'Underperform' as the banking heavyweight’s risk-reward getting favourable incrementally. The stock grew by around one per cent on Friday to Rs 1728.3 per share on the BSE intraday trade.

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However, at around 10:10 am, the scrip was trading flat at 0.3 per cent growth to Rs 1720.15 per share, as compared to a 0.02 per cent decline in the S&P BSE Sensex on Friday.

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CLSA said, the Kotak Bank has underperformed peers by 35-75 ppts and Nifty by more than 25 per cent over the past six months. Moreover, the bank has also built a formidable franchise with the lowest cost of funds and good asset quality, it added while setting a target of Rs 1900 per share.

Since Monday, the counter has been trading volatile, mostly below Rs 1720 per share levels on the BSE. It has declined in the last one month by three per cent, while has gained around 28 per cent in the last one year. Kotak Bank has a market capitalisation of over 3.4 lakh crore on the BSE.

The bank, on June 16, 2021, had mentioned in an exchange filing that they expect the claims, net of reinsurance for the first quarter of FY22 will be significantly higher amid the rampant second wave of coronavirus and the provisioning of the bank will depend on the trends in mortality. Kotak Bank has a life insurance arm called Kotak Life, which handles claims and reinsurance processes.

Kotak Mahindra Bank had reported growth of 33 per cent net profit to Rs 1682 crore in the March-ended quarter as against Rs 1266 crores in the same period a year ago.