Kotak Mahindra Bank Ltd (KMB) has announced a significant 25.63% year-on-year (YoY) rise in its standalone net profit for the June quarter, reaching Rs 4,122.96 crore. This figure surpasses the Rs 3,281.68 crore reported in the corresponding quarter last year and exceeded analyst projections of a 19-20% increase.
Key Financial Metrics and Performance
The private lender's Net Interest Income (NII) grew by 9% YoY and 1% quarter-on-quarter (QoQ), settling at Rs 7,928 crore for the June quarter. This compares to Rs 7,259 crore a year earlier and Rs 7,876 crore in the preceding March quarter.
However, the Net Interest Margin (NIM) saw a slight moderation, decreasing to 4.53% from 4.67% QoQ and 4.65% YoY. The cost of funds improved significantly to 4.46% from 5.01% YoY, remaining largely stable against 4.45% in Q4FY26.
Fee and services income increased by 11% YoY to Rs 2,500 crore, although it saw a decline from Rs 2,767 crore in Q4FY26. Operating expenses rose 8% YoY to Rs 5,135 crore, staying relatively flat QoQ. The bank's operating profit demonstrated robust growth, increasing 10% YoY and 5% QoQ to Rs 6,131 crore.
Asset Quality and Deposit Growth
Provisions and contingencies for the bank decreased 45% YoY to Rs 668 crore. However, they saw a sequential increase from Rs 516 crore in the March quarter. The annualized credit cost stood at 0.46%, a notable improvement from 0.93% a year earlier and 0.39% in Q4FY26.
The bank reported healthy growth in its asset base, with net advances increasing 15% YoY to Rs 5,12,249 crore as of June 30, 2026. Customer assets, encompassing advances and credit substitutes, also rose 16% YoY to Rs 5,70,901 crore.
Deposit growth remained strong, with total period-end deposits growing 12% YoY to Rs 5,72,820 crore. Average total deposits increased 14% YoY to Rs 5,58,891 crore. The Current Account Savings Account (CASA) ratio stood at 40.3% as of June 30, 2026, compared with 40.9% a year earlier.
Gross non-performing assets (NPAs) were recorded at Rs 6,121.83 crore, with the percentage of gross NPAs to gross advances at a low 0.27% for the quarter, indicating sound asset quality.