Kotak Mahindra Bank Q4 FY23 results: Net profit up 26% to Rs 3,495 cr, dividend of Rs 1.50/share declared

Private sector lender Kotak Mahindra Bank said it has recorded a 26.3 per cent rise in standalone net profit year-on-year (YoY) in its March quarter. The standalone net profit stood at Rs 3,495.6 crore. Its net interest income (NII), or core income, jumped 35 per cent YoY to Rs 6,102.6 crore. It was Rs 4,521 crore in Q4 FY22.

The lender's operating profit rose 39.14 per cent during the quarter to Rs 4,647.37 crore. While its net NPA decreased to Rs 1,193.30 crore in Q4 vs Rs 1,736.71 crore in the year-ago period. Its net interest margin (NIM) was 5.33 per cent for the entire financial year 2022-23, while for Q4, it was 5.75 per cent.

The Board of Directors of the Bank has proposed a dividend of Rs 1.50 per share having a face value of Rs 5 for the last fiscal.

In a regulatory filing, Kotak Mahindra Bank said: “The board of directors of Kotak Mahindra Bank Limited have, at their meeting held today, inter alia, recommended a dividend of Rs 1.50 per equity share of the face value of Rs 5 each, out of the net profits for the financial year ended March 31, 2023, subject to the approval of the Members at the ensuing annual general meeting of the bank."

The bank said at a consolidated level its return on assets improved marginally to 3.06 per cent in Q4 FY23 in comparison to 2.94 per cent in Q4 FY22. In terms of asset quality, slippages came in at Rs 823 crore, which was 0.3 per cent of net advances. The ROE (return on equity) was up 16.88 per cent in Q4 FY23 as compared to 16.64 per cent in Q4 FY22.

Bad loans

The bank reported that its gross non-performing asset ratio was 1.78 per cent, while its net NPA ratio was 0.37 per cent for the March 2023 quarter. This was marginally lower than Q4 FY22 GNPA, which was 1.90 per cent.

The bank said it has added 2.2 million customers in the March quarter. Customers as of March 31 stood at 41.2 million compared to 32.7 million in the same quarter last year. The bank's deposits rose 16.5 per cent to Rs 363,096 crore at the end of FY23 in comparison to Rs 311,684 crore at FY22-end.

Brokerages had predicted that the private lender might report a 5-9 per cent rise in profit for the March quarter on a 30-35 per cent surge in net interest income (NII). Analysts said liability franchise may stay strong and that the asset quality and credit costs may exhibit steady trends. That said, they felt all would be on the traction in deposits and unsecured loans.

Phillip Capital expected Kotak Mahindra Bank to report a 7.2 per cent YoY rise in net profit at Rs 2,965.50 crore compared with Rs 2,767.40 crore in the same quarter last year. NII was predicted at 29.6 per cent YoY to Rs 5,858.30 crore for the quarter from Rs 4,521.40 crore in the corresponding quarter last year.

Motilal Oswal Securities expected the profit at Rs 3,015 crore, up 8.9 per cent, while it said NII might jump 33 per cent to Rs 6,016 crore.

Also read: Sebi bans Karvy Stock Broking, promoter from securities mkt for 7 yrs; imposes Rs 21-cr penalty

Also read: HUL muted Q4 results a temporary blip? Analysts share outlook, price targets for FMCG stock