Kotak Mahindra Bank - March 2013 Results Preview - Motilal Oswal

Lending business

- Profit from the lending business is expected to grow by ~23% YoY and ~4% QoQ, led by the standalone bank.

- For the standalone bank, we expect loan and PAT growth of 25% and 3% YoY respectively. Margins likely to decline ~12bp sequentially. Meanwhile, for Kotak Prime, loans and PAT are expected to grow by 14% YoY and 5% sequentially.

Capital Market and Asset Management business

- We expect PAT from capital market related businesses to grow by ~12% sequentially. Profit from securities business would grow 7% on a QoQ basis but decline 19% on YoY basis.

- In the Asset Management business, we expect a loss of INR76m v/s a profit of INR160m in 4QFY12 and INR220m in 3QFY13. The loss will be led by international subsidiaries and Kotak Investment Advisors.

- The stock trades at 15.7x FY15E EPS and 2.3x FY15E BV.

Source : Equity Bulls

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