Kotak Mahindra Bank Q3 Net Jumps 34%, Beats Estimates; Shares Surge

Private sector lender Kotak Mahindra Bank reported better-than-estimated-earnings for the October-December quarter on the back of strong loan growth. Its consolidated net profit came in at Rs 1,267 crore compared to Rs 945 crore in the corresponding quarter of last fiscal. Analysts polled by NDTV Profit had estimated its net profit at Rs 1,174 crore. 

Kotak Mahindra Bank's robust Q3 performance was supported by a 12 per cent increase in its advances to Rs 1.58 lakh crore, up from Rs 1.41 lakh crore last year. 

Analysts were expecting loan growth to take a hit after demonetisation. 

The Mumbai-based lender also reported an improvement in its profitability as its consolidated net interest margin (NIM), a gauge of profitability, improved 7 basis points sequentially to 4.48 per cent in Q3. 

On a standalone basis, Kotak Mahindra Bank's net profit registered 39 per cent growth to Rs 880 crore as against Rs 635 crore last year. 

Its net interest income, which is the excess of interest earned on advances over interest paid on deposits, grew 16 per cent to Rs 2,050 crore. 

Kotak Mahindra Bank also reported improvement in its asset quality. Its gross non-performing assets as a percentage of total advances stood at 2.42 per cent compared to 2.49 per cent in the September quarter and its net non-performing assets stood at 1.07 per cent, down from 1.20 per cent in the previous quarter. 

As of 1.32 p.m., Kotak Mahindra Bank shares traded 5.24 per cent higher at Rs 782.30 compared to 0.88 per cent gain in the broader Nifty.