Jefferies has maintained its buy rating on Kotak Mahindra Bank with a target price of ₹2,650 per share after the lender reported Q2FY26 profit of ₹33 billion, down 3% year-on-year but ahead of estimates due to better net interest income (NII), lower opex, and reduced credit costs.
Loan growth stood at 16% year-on-year, offsetting a weaker-than-expected NIM decline of 11 basis points sequentially. Credit quality improved with slippages down to 1.6%, while credit cost (excluding write-backs) moderated to 0.9% of average loans.
Jefferies trimmed its FY26–28 earnings estimates by 2–3% but said it continues to see Kotak as one of the most efficient private banks in terms of cost and capital management. However, it noted that the bank’s estimated FY27 return on equity (ROE) at 13% remains lower than peers, suggesting limited room for valuation re-rating in the near term.
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