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View Promises →Kotak Mahindra Bank Limited — Q3 FY26
Kotak Mahindra Bank reported a solid Q3 FY26 with standalone PAT of INR 3,400 crore, supported by healthy NIM of 4.54% and improving credit costs at 63 bps (down from 79 bps QoQ).
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Kotak Mahindra Bank reported a solid Q3 FY26 with standalone PAT of INR 3,400 crore, supported by healthy NIM of 4.54% and improving credit costs at 63 bps (down from 79 bps QoQ). Net advances grew 16% YoY and average deposits 15% YoY, driven by granular CASA growth and strong traction in SME (17% YoY) and mortgage (18% YoY) books. Management highlighted continued normalization of credit costs, though retail CV remains under watch. Fee income grew 6% QoQ, aided by capital markets and distribution. Guidance points to moderate NIM improvement in Q4, with deposit repricing tailwinds largely behind. Risk: potential hardening of term deposit rates and lingering stress in retail CV could pressure margins and asset quality.
कोटक महिंद्रा बैंक ने वित्त वर्ष 2026 की तीसरी तिमाही में अच्छा प्रदर्शन किया। बैंक का शुद्ध लाभ 3,400 करोड़ रुपये रहा। बैंक की ब्याज आय और खर्च के बीच का अंतर (NIM) 4.54% रहा, जो अच्छा है। कर्ज देने में होने वाला नुकसान (क्रेडिट कॉस्ट) पिछली तिमाही के 0.79% से घटकर 0.63% हो गया, जो बेहतर है। बैंक ने कुल कर्ज 16% और जमा 15% बढ़ाया। छोटे और मझोले उद्योगों (SME) को दिए गए कर्ज में 17% और घर के कर्ज (मॉर्गेज) में 18% की बढ़ोतरी हुई। बैंक की फीस आय में भी 6% का इज़ाफा हुआ। प्रबंधन का कहना है कि कर्ज नुकसान सामान्य हो रहा है, लेकिन रिटेल वाहन कर्ज पर नज़र रखी जा रही है। आगे NIM में थोड़ा सुधार हो सकता है। जोखिम: जमा पर ब्याज दरें बढ़ सकती हैं और रिटेल वाहन कर्ज में तनाव से मुनाफा और कर्ज की गुणवत्ता प्रभावित हो सकती है।
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Retail CV segment stress
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Net Interest Margin (NIM)
4.54%
Flat QoQ
NIM remained stable despite repo rate cuts; excluding short-term liquidity deployment, NIM improved to 4.58%.
Credit Cost
63 bps
-16 bps QoQ
Credit cost declined sequentially from 79 bps in Q2, driven by improvement in unsecured retail portfolios.
CASA Ratio
41.3%
Not specified
CASA ratio stood at 41.3% as of Dec 31, supported by granular growth in low-cost deposits.
SME Advances Growth
17% YoY
+17% YoY
Aggregate SME advances grew 17% YoY, with corporate SME vertical growing 26% YoY.
What Changed vs Last Quarter
NEW
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.
NEW
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.
NEW
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.
UPDATED
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.
DROPPED
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.
DROPPED
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.
NEW RISK
Hardening of term deposit rates
CFO noted that term deposit rates have inched up in early January, and liquidity tightening could pressure cost of funds in Q4.
NEW RISK
ECL provisioning impact
Draft ECL circular could require additional provisions; management estimates impact at less than 2% of net worth, but final circular may differ.
NEW RISK
Fee income growth lagging loan growth
Core fee income growth has been weaker than loan growth; management attributes it to muted credit card fees and expects gradual improvement.
RISK GONE
Further repo rate cuts could pressure NIM
If the RBI cuts rates further, NIM improvement may be delayed as deposit repricing benefits could be offset.
RISK GONE
Slow unsecured book rebuild
Credit card book declined 7% despite embargo lift; management is cautious on ramping up, which may delay revenue growth.
🤫 Topics management stopped discussing
Mentioned in Q1 FY26, Q2 FY25
Microfinance credit costs have peaked in Q1 and are expected to show a declining trend in coming quarters as fresh disbursements resume cautiously.
Mentioned in Q3 FY25, Q4 FY25
Management noted uncertainty whether microfinance industry changes are cyclical or structural, which could require business model changes.
Mentioned in Q1 FY25, Q3 FY25
Management could not provide a timeline for lifting the embargo, which continues to restrict credit card issuance and digital onboarding.
Mentioned in Q1 FY25, Q1 FY26
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.
Fast read
Guidance and risk preview
Management expects NIM to increase moderately in Q4 due to full-quarter benefit of CRR cuts and seasonal aberrations, assuming no further rate cuts.
Management continues to cautiously monitor the retail commercial vehicle segment, which has shown elevated stress; tighter underwriting and reduced...
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