Kotak Mahindra pips SBI to become India’s 2nd most valuable bank

MUMBAI: Kotak Mahindra Bank Ltd became India’s second most valuable lender on Monday, beating State Bank of India (SBI), after its shares closed at a record high. The private sector bank has a market capitalisation of ₹2.23 lakh crore, as against SBI’S ₹2.22 lakh crore.

HDFC Bank Ltd remained the country’s most valuable bank with a market capitalisation of ₹5.03 lakh crore.

At the end of March, promoter Uday Kotak held a 29.75% stake in Kotak Mahindra Bank; at Tuesday’s closing price, that stake is worth ₹66,333 crore.

Kotak shares closed 1.88% higher on Monday at ₹1,170.05, after touching a record high of ₹1,174 earlier in the day. So far this year, they have gained 16%.

SBI shares, on the other hand, closed 0.8% lower on BSE at ₹249.30. The stock closed lower for a fourth straight session. So far, this year, it has lost nearly a fifth of its value.

Analysts expect the Kotak stock to have robust buying interest owing to improvement in business growth and stable asset quality, with a net non-preforming asset ratio of 1%. Kotak will announce its earnings on 30 April. According to eight Bloomberg analyst estimates, the bank may report a net profit of ₹1,242.90 crore, up 27.3% from a year ago.

Of the 37 brokers tracking the stock on Bloomberg, as many as 26 have a “buy” rating, four recommend “sell” and seven have a “hold” rating.