Kotak Mahindra Bank Q3 Result Preview: Stable credit costs to aid earnings; asset quality to remain steady, say analysts

livemint.com:

Kotak Mahindra Bank Q3FY24 performance to be announced on Saturday. The market nervousness was visible and share price of Kotak Mahindra Bank ended 0.66% lower on Friday on the BSE. The caution on Banks prevails as market participants are not being kind to any disappointments in Q3 performance and even slight miss in the results on any parameters is leading to sharp correction in stock prices as had been the case with HDFC Bank.

For Banks while the Credit growth is being expected to remain steady. The loan growth also is seen to be good even though some analysts say that the unsecured loan growth is likely to moderate across banks. Also another key that remains watched for is deposit growth.

Also Read- Indian stock market: 6 key things that changed for market overnight - S&P 500 at record to US consumer sentiment Analysts in their preview reports have highlighted that asset quality is likely to remain in a sweet spot, leading to lower slippages, but recovery and upgrades are likely to lower as well. Analysts expect banks to report a 15-20 bps decline in NIMs. While loan yields have limited room for expansion, the deposit costs are likely to re-price higher.

Analysts at Motilal Oswal Financial Services (MOFSL) expect steady traction in loan growth for Kotak Mahindra Bank during the December 2024 quarter. They expect liability growth to remain healthy for Kotak Mahindra Bank. While Margins are expected to compress further for Kotak Mahindra Bank, asset quality to remain in control.

The Net Interest Income for Kotak Mahindra Bank is expected to grow healthy 15.2% year on year to ₹6510 Crore. Operating profits for Kotak Mahindra Bank at ₹4830 Crore are estimated to rise 25.5% year-on-year. MOFSL analysts peg Kotak Mahindra