Large Cap Banking Stock Trading 2.98% Down 52 Week High, Buy For 19% Upside: ICICI Direct

Leading brokerage firm ICICI Direct has assigned a "Buy" on Kotak Mahindra Bank (KMB) for potential gains of up to 19% with a target price of Rs 2,290 apiece. It is a large-cap banking stock with a market capitalisation of Rs. 3,85004 crore.

KMB is a powerful banking franchise, with promoter stake at ~26% and strong promoter-led management. It has a presence across the financial services value chain. CASA forms ~53% of total deposits aiding.

Stock Outlook - Market Price, returns, & 52-Week High/Low

The stock last traded at Rs. 1,922.96/share, 1.54% up from its previous close of Rs 1,908.60/share. Stock is trading 2.98% down from its 52 week high of Rs. 1997.55/share. Its 52 week low is Rs. 1,631/share. The stock has given 2.34% positive return in 1 week, and 14.08% in 1 month, respectively. It jumped 9.76% in 1 year, 46.09% in 3 years and 63.03% in 5 years, respectively.

Q4FY23 Results

According to brokerage firm, Robust performance with further improvement in asset quality.

• Advances up 17.9% YoY to Rs 3.2 lakh crore, deposits up 16.5% YoY
• NII growth at 35% YoY, NIMs expand 28 bps QoQ to 5.75%
• Credit cost at 24 bps. PAT grew 26.3% YoY, 25.2% QoQ at Rs 3495 crore
• GNPA declined 12 bps QoQ to 1.8%; net slippages at 0.3% of advances

Buy For A Target Price of Rs. 2,290/Share

According to the brokerage firm, KMB's share price has grown by 1.6x over the past five years. Focus on granular asset, liability mix and risk adjusted margins to aid earnings and return ratios. Management transition remains a near term event. "We maintain BUY rating on the stock as the long term well capitalised bank offers comfort. We value the standalone bank at ~3.4x FY25E ABV and subsidiaries at ~Rs. 501 post holding company discount giving an SOTP target price of Rs. 2290," ICICI Direct has said.

Disclaimer - The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.