“Hemindra Kishen Hazari” has been highlighting such lapse of corporate governance across various banks in the past. He has timely highlighted certain issues related to IndusInd bank as well in the past and shareholders have seen massive correction in its stock price during COVID crisis.

This article has highlighted many governance issues and lazy approach by bank management in addressing IT risks and probably there are few other undocumented issues.

Concerns mentioned in the article are genuine. With due respect to the Kotak Bank management, the observations are quite serious. Overall handling of IT systems and Kotak 811 App seems below my expectations.

Having worked in IT industry for over 25 years, and Cyber Security for over 5 years, the issues highlighted in the article look serious to me.

Disc: Holding Kotak Bank from the past 2 years and it seems that, Market has de-rated the stock from P/B of 5 to 2.5-2.8 with logical reasons. Need to be watchful about future events.

I won’t call it a fiasco, rather indifference.

We have seen that majority of the lenders regardless of their cachet have been found wanting (HDFC, Bajajfin, Kotak, many PSUs) in their IT infrastructure.

And it’s not a problem specific to India. Globally also many banks are running on legacy IT platforms and, for reasons best known to them, have put their infrastructure modernization on backburner. I faced many problems with a big international bank (including a recent fraudulent transaction on my credit card) and I moved my account to another bank.

In India, if every bank is found deficient, consumers don’t have any option but to put with all the risks and inconvenience. So it’s a very welcome step from RBI to crack down on this nonchalance from banks and full marks to them for being alert to such deficiencies in the system.

For banks, these are not tough problems to fix; they just needed a bit of rap on the knuckles.

HDFC and Bajajfin fixed their issues within 2-3 quarters. Recently Bank of Baroda did the same.
And I’m sure Kotak will get it done too sooner than later.

On May 8, 2024 BSE announced that it will launch single stock futures starting July 1, 2024. The product will be free of cost initially and will be offered fortnightly. BSE may offer a lower number of stocks to begin with, compared to the over 180 stocks offered by NSE in index derivatives.

AJ

“With effect from 01 January 2023, the Company has changed its method of depreciation on all Property, Plant and
Equipment from Written Down Value (“WDV”) method to Straight Line Method (“SLM”), based upon the technical
assessment of expected pattern of consumption of the future economic benefits embodied in the assets.
Due to the aforesaid change:
o The depreciation expense is lower by Rs. 388.7 Mn for the full year ended March 31, 2024.
o The Profit after tax (PAT) is higher by Rs. 290.8 Mn for the full year ended March 31, 2024.
does that mean pat yoy is almost slightly same after dedicting 29 cr from 120 cr

How does the business compare with newly listed peer kaka industries. Has anyone done a comparison in terms of capacities and other factors? Kaka has scaled up quite well in last few yrs. It is listed on sme in july 2023 and has similar clientele. But not sure of the brand recall of Kaka. Valuations seem similar in terms of pe at this level.