Kotak announces Q3FY16 results: Stock slips 1 per cent

Private sector lender Kotak Mahindra Bank came out with Q3FY16 numbers on Monday. The result is in line with the street expectations. However, the earnings are not strictly comparable to last year as the acquisition of ING Vysya Bank Ltd was effective as on 1 April 2015, the bank said in an exchange filing.

On financial front, the total income of bank increased by 3.28 per cent quarter on quarter (QoQ). It became Rs 6950 crores in Q3FY16 from Rs 6729 crores in Q2FY16. The other income of bank increased by 4.16 per cent to Rs 1805 crores, from Rs 1732 crores in Q2FY16. The Net Interest Income (NII), the difference between interest earned and interest expended increased by 4.02 per cent sequentially. NII decreased from Rs 2278 to Rs 2370 crore in the December quarter. Net interest margin this quarter stands at 4.4 per cent.

Sequentially, the provisions of bank increased by 32.72 per cent standing at Rs 261 crores in Q3FY16 from Rs 197 crores. The private lender increased provisioning despite an improvement in asset quality in the December quarter.

Net Non Performing Assets (NPAs) stood at 0.85 per cent versus 0.93 per cent sequentially, while gross NPAs stood at 2.01 per cent for the quarter ended December 31 compared with 2.08 per cent seen in the previous quarter. Net NPAs came in at Rs 1200 crore, compared to Rs 1258 crore in the previous quarter, a decrease of 4.61 per cent. The net profit of the bank increased by 2.37 per cent QoQ to Rs 938 crores in Q3FY16 from Rs 916.56 crores in Q3FY15.

The total Assets Under Management (AUM) of bank as on 31st December 2015 stood at Rs 95735 crores, an increase of 34.07 per cent from Rs 71404 crores in Q2FY16. Higher provisions for bad loans hit the stock of Kotak Mahindra. The scrip cracked by 1.30 per cent intra-day and it closed at Rs 667.15.

Kotak Mahindra Group is one of India's leading financial services conglomerates. The Group offers a wide range of financial services that encompass every sphere of life, right from commercial banking, to stock broking, mutual funds, life insurance and investment banking. The Group caters to the diverse financial needs of individuals and the corporate sector. As on December 31, 2015, the bank has a network of 1,298 full-fledged branches and 1,987 ATMs having both breadth and depth given the strong geographic complementarity of the merger.