After Uday Kotak's Exit,
Kotak Bank has seen regulatory action from the RBI and top management exit🤯🤯
What is happening at Kotak Bank?
The Bank just reported its numbers
A thread🧵on the results of Kotak Mahindra Bank and what lies ahead?
Lets go👇
Loan Growth:-
🏦Loan growth at 20%
🏦Cosumer loans grew at 20%
🏦Corporate loans grew at 20%
🏦Unsecured loans are growing very fast for Kotak
Deposit Growth:-
🏦Depsoit growth at 13%
🏦Term deposits grow at 35%
🏦Cost of funds at 4.13%
Deposit growth is slower for Kotak Bank
Asset Quality:-
🏦Gross NPAs fall to 1.39%
🏦Slippages at 1305cr
🏦PCR at 75.9%
Asset quality remains robust for the bank
Capital Adequacy:-
The Bank is adequately capitalized
TIER-1 Ratio at 19.6%.
In fact, the bank also declared a dividend
Action By the RBI:-
RBI IT department inspected CBS and online banking systems and found frequent outages.
As a result,
Kotak Mahindra Bank will now cease to onboard customers from online and mobile banks
RBI also bans new onboarding of credit cards .
Update from the Bank on the action taken:-
The Bank is taking steps for further steps to strengthen the IT systems
Impact Of RBI action on Kotak Mahindra Bank?
Kotak is anyway not aggressive on Credit cards.
Total loans outstanding on credit cards is just 3-4% of the total book.
The slowdown in loans from 811 will be a real hit for the bank
80-99% of new PL, credit card, and business lending (in volume terms) was done digitally.
Net not a very big hit for the bank
However, the reputation damage to Kotak is big.
Kotak prided itself on being world-class bank on compliance.
Given these deficiencies,
The premium will wane away for Kotak.
At a time when the bank is undergoing a transition.
This compliance embargo from RBI will be a real challenge for the new management.
Exit of Top Management?
After Uday Kotak
KVS Manian exited from the bank(mostly going to head federal bank)
Uday Kotak's entire team is now coming off
It remains to be seen how the new management leads the bank from these tough times
Valuation:-
Kotak now trades at 2.29x P/B
Which is now lowest in its history.
But the Uday Kotak premium is now going away for the bank
Conclusion:-
Kotak's results are nothing to complain about.
Growth is good
Asset quality is stable
They have strong capital and a superb franchise.
However the stability of top management and the response to RBI's embargo remain a jey monitorable for the bank
Keep following me -@AdityaD_Shah as I write daily to make you aware around:
📈Personal Finance
📈Investing
📈Stock Analysis
Go to my profile and hit the bell icon🔔to always stay updated
Disclaimer:-
This is my study
Not an Investment Advise
Please consult your own investment advisor before investing.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
After a change in strategy,
VA Tech Wabag reported spectacular nos with
🥤Strong margins and
🥤strong cash flows
But are these changes sustainable?🤔🤔
A thread🧵on the business of VA tech wabag & what lies ahead?
Let's go👇
Water purification is a major theme not only in India but across the world
In India,
The
Ministry of Jal Shakti allocated nearly 99500 cr for this.
Other Southeast Asian countries are also investing in this,
Most of this market is dominated by Municipalties across the world
As if derivative accounting problems were not enough,
Indusind Bank reported shocking numbers with even more problems:-
🏦 NPAs hidden in microfinance
🏦Inflated fee income
🏦The board suspects fraud by some employees🤯🤯
A thread on 🧵on the results of Indusind Bank and what lies ahead?👇
What is happening at Indusind bank?
In March,
Indusind Bank reported an accounting error in the derivatives book.
This led to 2000 cr and exit of top management.
That was just the tip of the iceberg,
The stock price has tanked from there
Let's find out more👇
First of all.
Let's break down the current fiasco,
1. Accounting discrepancy in the derivatives book
From 2019,
Indusind Bank did not report losses in the derivatives portfolio,
This lead to massive loss of 1960cr this quarter,
Third party investigation confirms the loss and that this is all of the loss,
It is suspected many insiders were involved in this cover up
IDFC First Bank spent
🩺400cr on Indian cricket sponsorship
🩺180cr in dividends
But to fund this
The bank raised nearly 10,000cr in the last 1 year😅😅😅
Now, as NPAs surge,
The bank reported a very poor set of numbers
A thread🧵on the business of IDFC First Bank & what lies ahead?👇
What has happened?
From the high of nearly Rs 90,
IDFC First bank has now lost nearly 30%,
The bank is seeing a surge in microlending NPAs,
Lets find out what lies ahead for IDFC👇
Lets first analyse the Q4 results:-
Loan growth:-
🏦The Bank reported a loan growth of 20%.
🏦Predominantly a retail asset bank.
🏦Unsecured loans remained 60% of the book.
🏦Credit cards book has started to grow sharply
🏦Home loans are now growing well