Kotak Mahindra Bank shares rise 4% on Q2 business updates; Goldman Sachs on stock prospects, price target

Shares of Kotak Mahindra Bank rose over 4% in early deals on Tuesday the lender reported a 24.7% year-on-year increase in net advances for the September 2026 quarter. Advances rose to Rs 5.77 lakh crore as of September 30, 2026. Total deposits rose 23.2% YoY to Rs 6.51 lakh crore, while CASA deposits increased 11.3% to Rs 2.49 lakh crore. The bank also reported $5.78 billion (around Rs 55,344 crore) in FCNR(B) deposits under the RBI’s swap facility. Advances of $1.68 billion, or around Rs 16,110 crore, against these deposits were held by the bank's international branches.

Net advances rose 12.7% quarter-on-quarter from Rs 5.12 lakh crore as of June 30, 2026. Average net advances stood at Rs 5.47 lakh crore, up 22.1% YoY and 10.5% QoQ.

The lender said said the September 30 figures were provisional and subject to limited review by its statutory auditors.

Goldman Sachs said Kotak Mahindra Bank reported a much stronger than expected Q2 business update.

It raised the target price to Rs 540.00 from Rs 416.30 and reiterated its Buy call.

The set-up for Kotak Bank remains compelling. "We have better clarity on leadership, strong liquidity position at the bottom of the rate cycle, potential acceleration in loan growth led by unsecured loans amid cheap valuations," said the brokerage.

Profitability is strong, and as earnings inflect, the brokerage expects the stock to compound as well as re-rate from current levels. The brokerage raised earnings to factor stronger than expected deposit flows (led by FCNR deposits) as well as bigger and faster rate hike cycle.

"We believe EPS growth of 19% CAGR during FY26-FY29E is very attractive at 15x FY28 P/E," it added.

Meanwhile, Kotak Mahindra Bank stock rose 4.31% to Rs 434.25 in early deals on BSE. Market cap of the lender rose to Rs 4.29 lakh crore.