Analysts hold mixed views on Kotak post-Q3

Mumbai: Brokerages have a mixed view on Kotak Mahindra Bank after the lender’s third quarter results. Analysts said valuations are expensive and asset quality, which came in a tad higher than expectations of some analysts, is manageable. Shares of Kotak Mahindra Bank ended down 2 per cent at Rs 1,795.15 on Monday.Emkay has a hold rating on the stock, Axis Capital has maintained reduce rating, Motilal Oswal is neutral on the stock and Morgan Stanley has retained equal-weight rating. Sharekhan and Edelweiss have a buy rating.The bank reported a 16 per cent rise in net profit to Rs 1,853.5 crore for the quarter ended December from the same period a year ago. 80472290Credit Suisse has maintained neutral but it raised target price on the stock to Rs 1,680 from Rs 1,275.Credit Suisse said the bank is likely to see better-than-industry asset quality outcomes but it has maintained neutral stance as the stock is trading at 4 times estimated core price to book for FY23.Emkay Global said gross non-performing assets came in higher than expected at 3.3 per cent in the quarter but the asset quality is manageable. The brokerage said the immediate concern regarding top management change is now behind with the RBI extending the Managing Director's term by three years but the bank needs to deliver on growth and drive higher return on equity to sustain rich valuations. Axis Capital retained its reduce rating on expensive valuation.

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