Kotak Mahindra Bank reported a 26.34% year-on-year increase in consolidated profit after tax (PAT), including the share of profits from associates, to ₹5,645.38 crore for the second quarter of FY27, compared with ₹4,468.27 crore in the corresponding period last year.
Excluding the share of profits from associates, consolidated net profit rose 26.72% to ₹5,634.07 crore from ₹4,445.94 crore a year earlier.
The private sector lender's consolidated total income increased 18.17% year-on-year to ₹29,426.88 crore during the quarter ended September 30, 2026. However, it declined from ₹30,068.60 crore in the preceding June quarter.
On a standalone basis, net profit grew 29.47% year-on-year to ₹4,211.97 crore from ₹3,253.33 crore in the year-ago period. Sequentially, standalone profit increased 2.16% from ₹4,122.96 crore.
Net interest income rises 16%
Kotak Mahindra Bank's standalone net interest income (NII), the difference between interest earned and interest expended, increased 15.71% year-on-year to ₹8,458.97 crore in Q2 FY27, compared with ₹7,310.74 crore in the corresponding quarter last year.
Other income rose 23.34% to ₹3,193.56 crore, while operating profit before provisions and contingencies increased 21.14% to ₹6,382.20 crore.
The bank's net interest margin (NIM), a key measure of the profitability of lending operations, moderated to 4.31% from 4.54% in the year-ago quarter and 4.53% in Q1 FY27.
The bank attributed the moderation largely to increased liquidity following inflows from foreign currency non-resident bank (FCNR-B) deposits. It mobilised ₹55,344 crore through these deposits during the September quarter.
Advances and deposits expand
The bank's net advances increased 25% year-on-year to ₹5.77 lakh crore as of September 30, 2026, compared with ₹4.62 lakh crore a year earlier.
Average total deposits rose 19% to ₹6.06 lakh crore in Q2 FY27 from ₹5.10 lakh crore in the corresponding period of the previous financial year.
The current account and savings account (CASA) ratio stood at 38.2% at the end of the September quarter, down from 42.5% a year earlier. The bank attributed the decline largely to an increase in the term deposit base following FCNR-B deposit inflows.
Asset quality improves
The bank recorded an improvement in its asset quality, with the gross non-performing asset (GNPA) ratio declining to 1.04% at the end of September 2026 from 1.39% a year earlier and 1.18% in the June quarter.
The net non-performing asset (NNPA) ratio fell to 0.24%, compared with 0.32% in the year-ago period and 0.27% in Q1 FY27.
In absolute terms, gross non-performing assets declined to ₹6,080.97 crore from ₹6,479.58 crore a year earlier. Net non-performing assets stood at ₹1,366.94 crore.
Consolidated provisions and contingencies fell to ₹820.43 crore from ₹1,054.42 crore in the corresponding quarter last year, supporting the growth in earnings.
Capital adequacy remains comfortable
Kotak Mahindra Bank's capital adequacy ratio under Basel III stood at 21.9% as of September 30, 2026, while its Common Equity Tier 1 (CET1) ratio was 21.4%.
The bank's standalone return on assets (RoA), calculated on an annu