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Kotak Mahindra Bank Q2 FY27: Profit Rises 26% to ₹5,645 Crore, NIM Slips to 4.31%

Kotak Mahindra Bank's consolidated Q2 FY27 profit rose 26% to ₹5,645 crore on lower provisions and 16% NII growth, but its margin fell to 4.31% on costlier FCNR deposits.

Raj ·Founder & Editor
Published in Finance · 3 min read ·
Glass office towers in a city financial district at golden hour, with a glowing upward-trending line reflected across one building's facade
Glass office towers in a city financial district at golden hour, with a glowing upward-trending line reflected across one building's facade
In this article

    As of 10:00 PM IST, Saturday 24 October 2026. Kotak Mahindra Bank announced its July–September 2026 (Q2 FY27) results on Saturday afternoon. Figures come from the bank's investor presentation filed with BSE and from reporting by The Economic Times, Business Standard, Fortune India and BusinessLine. Markets were closed on Saturday, so the share price reaction will come on Monday, 26 October.

    Kotak Mahindra Bank reported a 26% rise in consolidated net profit to ₹5,645 crore for the September quarter, up from ₹4,468 crore a year earlier and ₹5,480 crore in the June quarter. Profit grew mainly because of lower provisions and a 16% rise in net interest income. The weak spot was the net interest margin, which fell to 4.31%.

    Q2 FY27 numbers at a glance

    MetricQ2 FY27Q2 FY26Change
    Consolidated net profit₹5,645 crore₹4,468 crore+26%
    Standalone (bank) net profit₹4,212 crore₹3,253 crore+29%
    Net interest income (NII)₹8,459 crore₹7,311 crore+16%
    Net interest margin (NIM)4.31%4.54%−23 bps
    Provisions₹803 crore₹947 croreLower
    Credit cost0.35%0.79%Lower
    Net NPA0.24%0.32%Improved
    CASA ratio38.2%42.3%Lower

    Source: Kotak Mahindra Bank Q2 FY27 investor presentation (BSE filing), as reported by ET and Business Standard.

    Why the margin fell

    NIM dropped to 4.31% from 4.53% in the June quarter and 4.54% a year ago. Business Standard reported that the bank put most of the decline down to raising FCNR(B) deposits, which are foreign-currency deposits from non-resident Indians and usually cost more than ordinary savings money. The bank's CASA ratio (cheaper current and savings account money as a share of all deposits) also slipped to 38.2% from 42.3%. Together, the two show that funding is getting more expensive even as the loan book grows.

    Growth and asset quality

    • Deposits rose 23% year on year to ₹6,51,491 crore.
    • Customer assets (loans plus credit substitutes) at the bank rose 23% to ₹6,26,801 crore. On a consolidated basis they rose 21% to ₹6,99,250 crore.
    • Asset quality improved. BusinessLine reported a gross NPA ratio of 1.04%. Net NPA was 0.24%, and credit cost roughly halved to 0.35%.
    • Capital: consolidated capital adequacy was 22.4%, with CET1 at 22.1%. Consolidated return on assets was 2.10% and return on equity 11.70%.

    Subsidiaries

    Kotak Securities, the broking arm, earned ₹348 crore, and car-finance unit Kotak Mahindra Prime earned ₹251 crore, according to the results reports.

    Other bank results on Saturday

    Kotak was one of several lenders to report on 24 October. BusinessLine's live coverage reported that AU Small Finance Bank's profit rose 53% to ₹858 crore and that IDFC First Bank's profit nearly tripled to about ₹1,045 crore. Readers should check the companies' exchange filings for full details.

    What to watch

    • Monday's trading: Kotak shares closed at ₹430.50 on Friday, 23 October, down 1.49%, before the results. (The stock trades at ₹1 face value after its January 2026 split.)
    • Margin path: whether NIM steadies in the second half once the FCNR(B) inflows are absorbed.
    • Deposit mix: whether CASA recovers as the RBI tightens policy and deposit competition stays intense.

    Disclaimer: This article is for information only and is not investment advice or a recommendation to buy, sell or hold any security. HorizonDesk is not registered with SEBI as an investment adviser or research analyst. Please consult a SEBI-registered professional before making investment decisions.

    Related reading on HorizonDesk

    Sources

    Stock MarketFinance newsQ2 FY27 resultsKotak Mahindra BankBank EarningsNIMAsset QualityIndian Banks
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    Written by Raj

    Founder & Editor

    I write HorizonDesk: practical, no-hype articles on technology, money, business and the vehicles we drive. Everything here is something I’ve researched, tested or wanted explained clearly myself.

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