What To Expect From Kotak Mahindra Bank Q4 FY23 Results, A Preview

One of the largest private lender Kotak Mahindra Bank is slated to release its Q4FY 23 numbers on April 29, 2023. Market analysts are estimating that the bank will report high double-digit growth in net interest income for the quarter ended March, with improvement in profitability. However, growth in the bottomline is expected to be in single digits due to high base effect.

Earlier this month its peers ICICI Bank, Axis Bank, and HDFC Bank have posted robust performance and declared dividends for the fiscal. So now all eyes are on the performance of this bank.

As per various media reports, it is given that Kotak would report a broadly healthy quarter with net interest income (NII) to post strong growth led by a robust loan book. Margins are likely to improve ahead, and asset quality will continue to be stable.

Net interest income would be around 31 to 32%, margins would roughly expand around 5 to 6% and net profit would grow beyond 7% as per major brokerages In the March quarter of FY22, the bank had reported a 65% growth in the net profit.

Net interest income is seen increasing over 31% on year to Rs 5,938 crore, according to the average of 6 estimates.

ICICIdirect suggested that the bank is expected to report strong growth in advances of 21.5% YoY and 6.1% QoQ to Rs 3.29 lakh crore, while deposits likely to grow 13.5% YoY and 2.6% QoQ to Rs 3.53 lakh crore. NII is estimated to grow at 31.5% YoY to Rs 5,946 crore, while NIMs are expected to improve 23 bps QoQ to 5.7%.Thus, profit is expected to rise 7.9% YoY and 6.9% QoQ to Rs 2,984 crore. GNPA ratio is expected to improve 20 bps QoQ to 1.70%.

Motilal Oswal Securities feels that the bank's loan growth traction would be strong, this strong traction seen from unsecured loans and margins to remain healthy at 5.5%. Growth in deposits is to be seen. Expect asset quality and credit costs to exhibit steady trends. Commentaries on stress in the SME book and other unsecured loans would have to looked out for.

Even Prabhudas Lilladher suggested the same about the Kotak's loan traction, it has been strong and we expect the momentum to continue and build-in 21% YoY and 5.6% QoQ growth. Credit cost would remain in the same range with PCR near to 78%. CASA accretion to slow down further, hence, margins would see only marginal improvement.

Only Emkay Global Financial expects a decline in the margins on quarterly basis, which coupled with slightly higher opex would hurt profitability. Slippages are expected to be similar to Q2 levels.

Axis Securities hints at growth in advances growth, with traction on unsecured products to remain healthy. NII expected to grow healthy, and margins to be within the 5.5% range. Cost ratios to remain flat QoQ, pre-provision operating profit growth to be healthy. Credit costs to come at normalized levels, and asset quality to remain stable. Management commentary on NIMs and growth outlook will be have to watched as the key.