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Informist, Saturday, Oct. 25, 2025

 

--Kotak Bank MD: Remain cautious on retail commercial vehicle segment

--CONTEXT:Comments by Kotak Mahindra Bk's mgmt in post-earnings analyst call

--Kotak Bank MD: To focus on building back retail unsecured business

--Kotak Bank: Seeing higher stress in retail commercial vehicle segment

--Kotak Bank: Expect microfinance loan growth to improve in coming qtrs

 

By Pratiksha and Akash Mandal

 

MUMBAI/NEW DELHI – Kotak Mahindra Bank Ltd. expects growth in its microfinance loan portfolio, which has been declining for the last few quarters, to improve going ahead, the lender's senior management said in a post-earnings analyst call on Saturday. 

 

"The microfinance stress peaked in quarter one (Apr-Jun) and we expect the portfolio performance to continue to gradually improve in the coming quarters," the management said. The bank's retail microcredit loans fell 41% on year and 3% on quarter to INR 57.25 billion in the September quarter.

 

The Mumbai-based bank's net profit for the September quarter fell marginally on year to INR 32.53 billion, mainly because of a jump in provisions. The bank reported 16% on-year growth in net advances at INR 4.63 trillion as of Sept. 30. 

 

The management said it would focus on rebuilding its retail unsecured business, the share of which fell to 9.2% in the lender's total loan book in the September quarter from 11.3% a year ago. 

 

The bank is seeing higher stress in the retail commercial vehicle segment and remains cautious on this, the management said. "We are seeing higher stress in the retail CV (commercial vehicle) segment," it said. "Hence, over the last few quarters, we tightened our underwriting and we have reduced our disbursements to this segment."

 

Growth in the private sector bank's commercial vehicle and construction equipment loans was flat sequentially in the June quarter. In the September quarter, the segment reported on-quarter growth of just 2% to INR 436.76 billion. It rose 12% on year in the September quarter.  

 

The lender's credit card volumes have been lower than the aspiration, but are expected to pick up in the coming quarters, the management said. In April 2024, the Reserve Bank of India had barred Kotak Mahindra Bank from onboarding new customers through its online and mobile banking channels and issuing fresh credit cards after an examination of the bank's information technology infrastructure had raised "significant concerns". The RBI lifted the restrictions in February. 

 

"Credit cards, hopefully for H2 (Oct-Mar) would tend to be better than (Apr-Sept)," it said. On Friday, shares of Kotak Mahindra Bank ended 1.7% lower at INR 2187 on the National Stock Exchange.  End

 

Edited by Avishek Dutta

 

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