Ranvir’s Portfolio

Kotak Mahindra Bank –

Q2 FY 25 concall and results updates –

Deposits – 4.46 lakh cr, up 16 pc YoY

Breakup of deposits –

Current account – 61.8k cr, up 6 pc
Savings account – 1.24 lakh cr, up 2 pc
Term deposits – 2.59 lakh cr, up 26 pc
CASA ratio @ 43.6 pc

Cost of funds @ 5.15 vs 4.78 pc YoY

CASA + Term Deposits < 5 cr constitute 79 pc of deposits

Total customers on 30 Sep @ 5.2 cr vs 4.6 cr YoY

Assets ( loans ) – 4.5 lakh cr, up 18 pc YoY

Breakup of assets –

Home loans + LAP – 1.16 lakh cr, up 18 pc
Business banking – 40k cr, up 21 pc
Personal loans + Consumer durable loans – 20.8k cr, up 17 pc
Credit cards – 14.4k cr, up 15 pc
CV + CE loans – 39k cr, up 26 pc
Agri Loans – 26.9k cr, flat YoY
Tractor finance – 16.1k cr, up 13 pc
Retail Microfinance – 9.7k cr, up 21 pc ( however, it was down QoQ )
Commercial loans – 91.9k cr, up 14 pc
Corporate loans – 92.8k cr, up 13 pc
SME – 32.1k cr, up 31 pc
Others -10k cr, up 33 pc
Credit substitutes – 30.9k cr, up 32 pc

Gross NPAs – 1.49 vs 1.72 pc ( @ 6033 vs 6087 cr )
NNPAs – 0.43 vs 0.37 pc ( @ 1724 vs 1275 cr )
Total provisions @ 6266 vs 6721 cr

Slippages in Q2 @ 1875 cr vs 1314 cr YoY
Upgrades and recoveries @ 681 vs 942 cr
Write Offs @ 638 vs 194 cr

P&L for the bank ( standalone ) –

NII – 7020 cr, up 11 pc
Other Income – 2684 cr, up 16 pc
Net total income – 9704 cr, up 13 pc
Operating expenses – 4605 cr, up 15 pc
Operating profits – 5099 cr, up 11 pc
Provisions – 660 cr, up 80 pc
PAT – 3344 cr, up 5 pc

Kotak AMC –

AUM @ 4.73 vs 3.36 lakh cr
PAT @ 197 cr, up 58 pc
Monthy SIPs ( in Sep 24 ) @ 1764 cr, up 23 pc YoY

Kotak life Insurance –

PAT @ 360 cr, up 106 pc

Kotak Prime –

PAT @ 269 cr, up 29 pc

Kotak Securities –

PAT @ 444 cr, up 37 pc

International Subsidiaries –

PAT @ 76 cr, up 84 pc

Kotak Investments –

PAT @ 141 cr, up 12 pc

Kotak capital company –

PAT @ 90 cr, up 233 pc

Consolidated profits @ 5044 cr, up 13 pc YoY

Bank expects to keep exercising caution on MFI loans. Expect this trend to continue for another 2-3 Qtrs before getting back to growth path again

Credit card business has been impacted by the Ban imposed by RBI on issuance of fresh cards

Consol ROE @ 13.88
Consol ROA @ 2.53

Share of profits of subsidiaries stands @ 33 pc

Embargo on issuance of fresh credit cards + bank going slow on the MFI business resulted in NIM compression in Q1

With the ongoing festive season + pickup in Govt spending in H2, bank expects pickup in the economy in H2. This should be positive for their CV+CE + tractor finance – lending business

Mid-Corporates and SME segments continue to grow strongly. Large corporate segment is seeing irrational pricing

Kotak AMC’s mkt share now stands @ 7.1 pc with an AUM of 4.7 lakh cr. Their retail AUM stands @ 60 pc

Bank believes that the trend of higher slippages should play out over next 2 Qtrs after which it should again start to fall. They have taken a lot of actions on the credit card and micro finance side to ensure that this happens

Mid-Corporates and SME segments continue to grow strongly. Large corporate segment is seeing irrational pricing

On 18 Oct, the Bank announced acquisition of personal loan book ( of 4100 cr ) of standard chartered bank. These are all standard loans of affluent customers. It also gives them access to 95k new affluent customers ( avg personal loan per customer works out to be around 4.3 lakh )

Currently, Bank’s unsecured book stands @ 11 pc of loans. They intend to take it to mid teens levels. This will help them achieve better margins and accelerate their growth

Bank is hopeful of greater recoveries in Q3, Q4 ( from the secured book ) which should help them reduce their net slippages in H2

Bulk of the slippages are happening in the Credit Card + MFI business. And that’s the nature of business

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation