Kotak Mahindra Bank gets an upgrade from UBS, shares gain
UBS praised Kotak Mahindra Bank's growth potential, particularly in its non-lending subsidiaries.
- Aug 29, 2025,
- Updated Aug 29, 2025 12:01 PM IST
Shares of Kotak Mahindra Bank rose 2% on Friday led by a favourable upgrade from Swiss investment bank UBS. The bank's rating was elevated to 'Buy' from a prior 'Neutral', with UBS highlighting "strong growth prospects across business segments."
The brokerage has set a fresh price target of ₹2,450, suggesting a 26% potential upside from the last session's closing price. UBS emphasised that Kotak's diversified business model across various financial services provides a strategic advantage in the market.
Kotak Mahindra Bank's share price reached ₹1,984.85 , rising 2%. Market cap of the bank rose to Rs 3.91 lakh crore. With this, the banking stock has gained 10% so far in 2025.
UBS sees Kotak as offering "the best play across key financial service segments through its wholly owned subsidiaries," owing to a significant contribution from its non-lending segments. It was noted that areas like asset and wealth management could outpace lending growth by 1.4-1.7 times, as "driven by a structural shift in household savings and investment patterns." This shift indicates a broader trend in the financial industry, where non-lending services are gaining prominence.
UBS further commented on Kotak's robust outlook, citing "easing margin and credit cost pressures, faster growth potential, and superior ROA" as factors likely to raise the stock's valuation. In a broader sector context, UBS stated that "India's profit pool could nearly double in the next five years," showing preference for competitors such as Cholamandalam Investment & Finance, Power Finance Corporation, and SBI Life Insurance Company in the financial space.
Shares of Kotak Mahindra Bank rose 2% on Friday led by a favourable upgrade from Swiss investment bank UBS. The bank's rating was elevated to 'Buy' from a prior 'Neutral', with UBS highlighting "strong growth prospects across business segments."
The brokerage has set a fresh price target of ₹2,450, suggesting a 26% potential upside from the last session's closing price. UBS emphasised that Kotak's diversified business model across various financial services provides a strategic advantage in the market.
Kotak Mahindra Bank's share price reached ₹1,984.85 , rising 2%. Market cap of the bank rose to Rs 3.91 lakh crore. With this, the banking stock has gained 10% so far in 2025.
UBS sees Kotak as offering "the best play across key financial service segments through its wholly owned subsidiaries," owing to a significant contribution from its non-lending segments. It was noted that areas like asset and wealth management could outpace lending growth by 1.4-1.7 times, as "driven by a structural shift in household savings and investment patterns." This shift indicates a broader trend in the financial industry, where non-lending services are gaining prominence.
UBS further commented on Kotak's robust outlook, citing "easing margin and credit cost pressures, faster growth potential, and superior ROA" as factors likely to raise the stock's valuation. In a broader sector context, UBS stated that "India's profit pool could nearly double in the next five years," showing preference for competitors such as Cholamandalam Investment & Finance, Power Finance Corporation, and SBI Life Insurance Company in the financial space.