Why Kotak Mahindra Bank Shares Are On The Up Today

Kotak Mahindra Bank shares saw an early spurt after the bank allotted 30,000 non-convertible debentures to raise ₹300 crore.

What happened? Per an exchange filing, the private sector lender allotted bonds in the nature of debentures, of the face value ₹1 lakh each, on a private placement basis.

The development arrives after the bank’s board approved the issuance of listed, redeemable, unsecured non-convertible debentures worth ₹2,000 crore in the 2022-2023 financial year.

"Approved issuance of listed, redeemable, unsecured non-convertible debentures ("NCDs”), in one or more tranches/ series, on a private placement basis, for an amount not exceeding ₹2,000 crore, during the remaining period of FY 2022-23 under the prevailing Members' approval,” said Kotak Mahindra Bank in a regulatory filing back in January.

Kotak Mahindra Bank had managed a standalone net profit of ₹2,791.88 crore in Q3 of FY23 compared to ₹2,131.36 crore a year ago same quarter — registering a growth of a whopping 30.99% year-on-year.

See also: Zerodha Co-Founder Says Forget FDs And Look At This ‘Risk-Free’ Way To Park Cash In Current Crisis

The lender’s asset quality improved with gross NPA declining sharply, however, provisions increased during the quarter. Net interest income (NII) which is the difference between interest earned and interest expended, came in at ₹5,653 crore in Q3 of FY23.

The latest quarter’s NII climbed by 30.43% from ₹4,334 crore in Q3FY22 and was up by 10.86% from ₹5,099 crore in Q2FY23.

Price action: Kotak Mahindra Bank shares were trading 0.5% higher at ₹1,707.85 before quickly retreating to ₹1,701.45.

See also: Supreme Court Directs SEBI To Re-Pay ₹300 Crore To NSE: Here's Why