Kotak Mahindra Bank reports over ₹3,280cr net profit in Q1
What's the story
Kotak Mahindra Bank has announced its financial results for the first quarter of the fiscal year. The bank reported a net profit of ₹3,281.7 crore for the June quarter, which is significantly lower than market expectations and last year's figures. The latest figure fell short of Street estimates of ₹3,442 crore and was also 57.5% lower than last year's ₹6,250 crore.
Financial growth
Net interest income for the June quarter
Despite the dip in net profit, Kotak Mahindra Bank's net interest income (NII) for the June quarter was reported at ₹7,249 crore. This was close to market expectations of ₹7,293 crore and a 6.1% increase from last year's ₹6,842 crore in Q1 of the previous fiscal year. The NII is a key indicator of a bank's profitability as it reflects the difference between interest earned on loans and interest paid on deposits.
Asset performance
Gross non-performing assets rise
Kotak Mahindra Bank's gross non-performing assets (NPA) rose to ₹6,637.7 crore in Q1 from ₹6,134 crore in the last quarter of FY 2025. The NPA ratio stood at 1.48% for the June quarter, up from 1.42% in the previous quarter. This indicates a slight deterioration in asset quality as more loans have turned bad or are not being repaid on time by borrowers.
Information
Net interest margin and bank's shares
Kotak Mahindra Bank posted a net interest margin (NIM) of 4.65% for the quarter, below Street expectations of 4.8% and down from 4.97% in the previous quarter. The bank's shares closed 0.98% lower at ₹2,121.2 in the last session but remain up 18.6% year-to-date.