Kotak Mahindra Bank shares gain nearly 2% after lender rejigs top management

Shares of Kotak Mahindra Bank gained 1.7 percent to Rs 1,762 per share on February 20 after the private sector lender announced key changes to its senior management team.

So far this year, the stock of Kotak Mahindra Bank has declined 3 percent, as against 0.8 percent rise in the benchmark Sensex.

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KVS Manian has been re-designated as the bank's joint managing director effective March 1, 2024. Currently, he is serving as the whole-time director and key managerial personnel.

Additionally, Shanti Ekambaram, presently a whole-time director and key managerial personnel, will become the deputy managing director upon receiving necessary approvals.

Devang Gheewalla has been appointed as the new chief financial officer, designated as president and group chief financial officer, effective April 1, 2024, succeeding Jaimin Bhatt, whose tenure as group president and group chief financial officer concludes on March 31, 2024.

Moreover, Milind Nagnur, the current chief technology officer, will take on the position of chief operating officer of the bank from April 1, 2024, overseeing operations and the group's technology architecture and cybersecurity, while retaining his role as chief technology officer.

Lastly, Paul Parambi, the current chief risk officer, will assume the role of group chief risk officer, effective March 1, 2024. Both Nagnur and Parambi have been acknowledged as senior management personnel of the bank.

Management rejig to hopefully arrest top management attrition: Emkay Global

Analysts at Emkay Global retained an 'add' rating on the lender, sharing a target price of Rs 1,950 apiece, implying an upside of 10 percent from current levels.

"We believe such a rejig by Kotak Mahindra Bank should possibly alleviate any immediate risk of top management attrition, but the new MD will still have the task of curbing attrition at the operational level, manage the ensuing asset quality risk, and review bank's strategic stance on business or branch expansion," the brokerage firm said.

In Q3FY24, the lender had reported 7.6 percent on-year rise in net profit to Rs 3,005 crore, while net interest income jumped 16 percent YoY to Rs 6,554 crore.

On the asset quality front, gross non-performing assets (NPA) ratio came at 1.7 percent of gross advances, while net NPA ratio stood at 0.3 percent for the period.

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