Kotak Mahindra Bank FY26 Annual Earnings Summary
4 quarters covered · ₹0 Cr revenue · ₹19,287 Cr PAT · 0.0% average EBITDA margin.
Quarter-by-quarter progression
Management promises made during the year
Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q1 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q3 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q3 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q3 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY26Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY26Risks flagged during the year
The West Asia crisis and Strait of Hormuz disruptions could impact supply chains, oil prices, and inflation, potentially affecting credit quality at the lower end.
Q1 FY26 · mediumStress in the retail commercial vehicle segment, particularly goods transportation, is expected to continue for another quarter or two, with management moderating disbursements.
Q1 FY26 · mediumAn analyst questioned whether the bank's runoff mode in microfinance could reduce borrowers' willingness to pay, potentially leading to higher loss rates. Management acknowledged the risk but expressed confidence in new underwriting models.
Q1 FY26 · mediumAn analyst flagged that economic growth is a key variable for MSME debt servicing. Management said they are monitoring closely but noted the portfolio is secured and holistic customer view helps.
Q1 FY26 · mediumThe full impact of the June repo rate cut will be felt in Q2, and NIM may bottom out only then before recovering in H2. This was highlighted in Q&A.
Q2 FY26 · mediumStress in the retail commercial vehicle segment continues, with management expecting elevated credit costs for a few more quarters.
Q2 FY26 · mediumIf the RBI cuts rates further, NIM improvement may be delayed as deposit repricing benefits could be offset.
Q3 FY26 · mediumManagement continues to cautiously monitor the retail commercial vehicle segment, which has shown elevated stress; tighter underwriting and reduced disbursements are in place.
Q3 FY26 · mediumCFO noted that term deposit rates have inched up in early January, and liquidity tightening could pressure cost of funds in Q4.
Q4 FY26 · mediumIMD's forecast of a below-normal monsoon due to El Niño could stress rural income and impact asset quality in tractor and microfinance portfolios.
Q4 FY26 · mediumThe bank has increased term deposit rates (peak 6.8%) to lock in longer-tenure deposits, which could pressure NIMs in the second half of FY27.
Q2 FY26 · lowCredit card book declined 7% despite embargo lift; management is cautious on ramping up, which may delay revenue growth.
What changed through the year
Q1 FY26 · NIM stabilization expected in H2 FY26
Management expects NIM to stabilize in the second half of the year as deposit repricing and CRR cuts offset asset yield drag, assuming no further repo rate cuts.
Q1 FY26 · MFI credit costs to decline from Q2
Microfinance credit costs have peaked in Q1 and are expected to show a declining trend in coming quarters as fresh disbursements resume cautiously.
Q1 FY26 · Credit card costs to decline in H2
Credit card credit costs have plateaued and should start declining in the second half of the year.
Q1 FY26 · Retail unsecured target of 15% of advances
Aspirationally, the bank aims to grow retail unsecured advances to 15% of total advances, from current 9.7%, through MFI, personal loans, and credit cards.
Q2 FY26 · NIM gradual improvement in H2
Management expects NIM to improve gradually in H2 FY26 as deposit repricing benefits flow through, assuming no further repo rate cuts.
Q2 FY26 · Credit costs to gradually moderate in H2
Credit costs are expected to continue moderating in H2, with personal loan normalized, MFI improving, and credit cards stabilizing.
Q2 FY26 · Unsecured book rebuild focus
Management aims to gradually rebuild the unsecured retail book (credit cards, personal loans) with disciplined underwriting, targeting growth in coming quarters.
Q3 FY26 · Moderate NIM improvement in Q4
Management expects NIM to increase moderately in Q4 due to full-quarter benefit of CRR cuts and seasonal aberrations, assuming no further rate cuts.
Q3 FY26 · Credit cost to gradually decline further
Credit cost expected to continue its downward trend in Q4 and Q1, though at a moderated pace, with retail CV stress plateauing.
Q3 FY26 · Cost-to-asset ratio target of 2.5%-2.6%
Management aims to maintain cost-to-asset ratio in the range of 2.5%-2.6% over the medium term, driven by fixed cost control and digitization.
Q3 FY26 · Unsecured retail loan growth to resume
Personal loan book expected to return to growth in coming quarters as organic disbursements pick up, while credit card spend growth to follow.
Q4 FY26 · NIM to decline gradually in FY27
Management expects NIM to reduce gradually in FY27, with the reduction more pronounced in the second half, but at a much slower pace than the 36 bps drop in FY26.
Q4 FY26 · Credit cost to remain lower
Credit cost is expected to remain lower, driven by improved collection efficiency and tighter underwriting, especially in unsecured segments.
Q4 FY26 · Cost-to-asset ratio to improve further
Management expects continued improvement in cost-to-asset ratio through fixed cost reduction and automation, building on the 27 bps improvement in FY26.