Summary:
Kotak Mahindra Bank reported a 29% year-on-year rise in standalone Q2 FY27 net profit to ₹4,212 crore. Net interest income grew 16%, while NIM narrowed to 4.31%. Improved asset quality and lower credit costs supported earnings, despite margin pressure.
Kotak Mahindra Bank standalone net profit for Q2FY27 was ₹4,212 crore, up 29% YoY from ₹3,253 crore in the same period last year. The private sector lender reported higher net interest income, lower credit costs and better asset quality, even as net interest margin (NIM) contracted in the September quarter.
Kotak Bank Q2 Results: Profit, Interest Income up
The bank's consolidated net profit rose 26% YoY to ₹5,645 crore from ₹4,468 crore in Q2FY26. Q1FY27 consolidated profit rose 3% sequentially to ₹5,480 crore.
Standalone net interest income (NII) – the difference between interest earned and interest paid – grew 16% YoY to ₹8,459 crore from ₹7,311 crore.
Operating profit up by 21% at ₹6,382 crore, fee and services income up by 21% YoY at ₹2,926 crore.
| Financial metric | Q2FY27 | Q2FY26 | YoY change |
| Standalone net profit | ₹4,212 crore | ₹3,253 crore | +29% |
| Consolidated net profit | ₹5,645 crore | ₹4,468 crore | +26% |
| Net interest income | ₹8,459 crore | ₹7,311 crore | +16% |
| Operating profit | ₹6,382 crore | ₹5,268 crore | +21% |
| Net interest margin | 4.31% | 4.54% | -23 bps |
Kotak Mahindra Bank Q2FY27 results, Oct 24, 2026.
Why did Kotak Bank’s Net Interest Margin fall?
Despite higher earnings, NIM was down at 4.31% v/s 4.54% in Q2FY26 and 4.53% in Q1FY27.
The decline was principally due to the mobilisation of foreign currency non-resident (FCNR(B)) deposits.
Kotak Bank mobilised FCNR(B) deposits of around ₹55,344 crore during the quarter and its international branches disbursed loans of ₹16,110 crore.
The bank’s cost of funds was 4.52% compared with 4.46% last quarter.
NIM is the ratio of the difference between interest earned and interest paid to assets earning interest. A fall means lending profitability is under pressure while the overall loan book is growing.
Asset Quality Improves, Credit Costs Down
Asset quality improves in Q2FY27.
Gross non-performing assets (GNPA) declined to 1.04% from 1.39% a year ago and net NPA came down to 0.24% from 0.32%.
The annualized credit cost has come down to 0.35% as against 0.79% in Q2FY26 and 0.46% in Q1FY27.
Provisions were ₹803 crore, down 15% YoY but higher than ₹668 crore in June quarter.
Net slippages decline 24% YoY to Rs 1,230 crore, indicating lesser number of loans turning into non-performing assets.
Why shares of Kotak Mahindra Bank spiked post Q2 results
Kotak Mahindra Bank shares surged nearly 4% to Rs 446 on BSE on Monday, October 26, 2026 after the bank posted its earnings.
Kotak Bank share price closed at ₹430.10 on 23 October.
Higher interest income, strong earnings growth and better asset quality were the main drivers of the positive reaction, although NIM declined.
What is in store?
Kotak Bank’s net advances were up 25 per cent year-on-year to Rs 5,77,295 crore and deposits were up 23 per cent at Rs 6,51,491 crore.
Advances excluding FCNR(B) related loans and the acquired loan portfolio grew by 19%. FCNR(B) deposits rose by 13 per cent.
The next few quarters will show if the bank can keep up loan growth, keep credit costs low and stabilise margins.
Q2FY27 Results: Improvement in profitability and asset quality; NIM movement a key lever for future earnings.
