Kotak Mahindra Bank – Low Cost Liability Banking Franchise

I tell myself that the historical valuations are indeed…historical. Based on the current position of competing private banks which are all in very good shape, growing very well, well managed now and corp governance issues non existing (I hope), Kotak and HDFC bank may not enjoy the historical valuations going forward. So I expect that 3x may be the valuation going forward…which means from here, the stock price may move along with improvement in the book value, and no rerating in P/B multiple.