Kotak Mahindra Bank Sees 2.7% YoY Drop in Q2 Profit to ₹3,253 Crore

Post by : Bianca Suleiman

Kotak Mahindra Bank announced its second-quarter financial results for the fiscal year 2025-26 on Saturday, revealing a slight decrease in net profit alongside positive trends in crucial financial metrics. The private lender's profit fell 2.7% year-on-year to ₹3,253 crore for the quarter ending September 30, 2025, in comparison to ₹3,344 crore during the same timeframe last year.

This update came in the wake of a 1.29% decline in the bank's stock price, which stood at ₹2,192.50 per share on October 24, just prior to the announcement.

While profit took a dip, the bank demonstrated a robust performance in its core indicators. The Net Interest Income (NII) grew by 4% year-on-year to ₹7,311 crore, up from ₹7,020 crore in Q2FY25, bolstered by strong loan growth and stable profit margins. The Net Interest Margin (NIM) was reported at 4.54%, with the cost of funds at 4.70%.

Operating profit also saw a year-on-year increase of 3%, reaching ₹5,268 crore, while operating expenses increased by only 1% to ₹4,632 crore, indicating effective cost management during the bank's expansion.

Kotak's net advances demonstrated impressive growth of 16% year-on-year, totaling ₹4,62,688 crore in Q2FY26 compared to ₹3,99,522 crore during the same period last year. Additionally, asset quality improved as Gross Non-Performing Assets (GNPA) reduced to 1.39% and Net NPA to 0.32%, down from 1.49% and 0.43% a year prior.

The bank also recorded significant growth in its wealth and asset management division, with Total Assets Under Management (AUM) climbing 12% year-on-year to ₹7,60,598 crore as of September 30, 2025, while Domestic Mutual Fund Equity AUM rose 14% to ₹3,62,694 crore.

Kotak Mahindra Bank's overall performance illustrates its stable operational footing amidst a competitive banking environment, with healthy advances and improving asset quality balancing a slight reduction in quarterly profit.