Kotak Mahindra Bank share price fell nearly 5% intra day after the firm said it decided on a 10% reduction in CTC for all employees with a salary of more than Rs 25 lakh per annum with effect from May 2020 for FY21. Employees earning less than Rs 25 lakh per annum will not be impacted.
Share price of Kotak Mahindra Bank fell 4.88% to Rs 1184 compared to the previous close of Rs 1245.50 on BSE. Kotak Mahindra Bank stock has lost 14.69% in the last one year and fallen 28.79% since the beginning of this year.
The large cap stock stands higher than its 5 day, 20 day, 50 day, 100 day and 200 day moving averages. 19 of 38 brokerages rate the stock 'buy' or 'outperform', 13 'hold', four 'underperform' and two 'sell', according to analysts' recommendations tracked by Reuters.
In an internal mail, the lender said that the pay cut will be effective from May and that employees earning less than Rs 25 lakh per annum will not be impacted. "We have decided on a 10 per cent reduction in CTC for all colleagues with a salary of more than Rs 25 Lakh per annum, with effect from May 2020 for FY21. Employees earning less than Rs 25 lakh p.a. will not be impacted," stated the internal mail, as mentioned in a report in Moneycontrol.
Kotak Mahindra Bank said that coronavirus is wreaking havoc on the economy, in turn impacting financial firms. It said that it is imperative to review the bank's costs and operations in advance to ensure sustainability.
"We need to ensure that our colleagues are safe and do our best to protect their jobs," the email said. The lender said that what seemed to be a 2-3 months' phenomenon in the beginning has snowballed into a pandemic with serious repercussions on lives and livelihood. "More importantly, it is increasingly clear that the pandemic is not going away anytime soon. Entire mankind is praying and hoping for quick discovery of a vaccine and antidote," it said.
By Aseem Thapliyal