Kotak Mahindra Bank Q4 FY26 profit up 13% to Rs 4,027 cr

Overview: Kotak’s Q4 profit rises, dividend proposed

Kotak Mahindra Bank reported a year-on-year increase of 13.4% in standalone net profit for the quarter ended March 31, 2026 (Q4 FY26), helped by lower provisions and an improvement in asset quality. Net profit came in at Rs 4,026.55 crore, above the Bloomberg consensus estimate of Rs 3,663 crore. The bank also proposed a final dividend of Rs 0.65 per equity share (face value Re 1), subject to shareholder approval at the upcoming annual general meeting (AGM).

The results were announced on Saturday, May 2, 2026, as per the details in the bank’s stock exchange filing. Alongside the profit print, the lender reported steady growth in its loan book and deposits at the end of the financial year.

Profit beats estimates as provisions fall sharply

A key contributor to the stronger bottom line was the decline in provisions and contingencies. Provisions fell 36% quarter-on-quarter to Rs 516 crore in Q4 FY26, supporting profitability for the period. Separately, the bank also disclosed that provisions and contingencies were Rs 516.42 crore in Q4 FY26 versus Rs 909.38 crore in Q4 FY25.

Operating profit increased 7% year-on-year to Rs 5,855 crore, indicating that core operating performance remained in growth territory even as margins moved within a narrow range. Standalone total income for Q4 FY26 rose to Rs 17,291.10 crore from Rs 16,712.23 crore in the same quarter last year.

Net interest income grows, while NIM is lower YoY

Net interest income (NII), a key measure of core earnings, rose 8.1% year-on-year to Rs 7,876 crore in Q4 FY26, up from Rs 7,284 crore in Q4 FY25. Interest income grew 4.8% to Rs 14,175 crore, while interest expense rose 0.9% to Rs 6,299 crore.

Net interest margin (NIM) stood at 4.67% for the quarter. This was lower than 4.97% a year ago, but higher than 4.54% in the previous quarter. The cost of funds declined to 4.45% from 5.09% a year earlier, as disclosed for the quarter.

Other income dips, operating expenses edge up

Other income declined 2.1% year-on-year to Rs 3,116 crore in Q4 FY26. The article also reported that fees and services increased to Rs 2,767 crore, up 6% year-on-year from Rs 2,616 crore.

On costs, operating expenses increased to Rs 5,137 crore in Q4 FY26, up 3% year-on-year from Rs 4,994 crore. These movements, combined with the fall in provisions, shaped the quarter’s profitability outcome.

Asset quality improves; slippages fall

Kotak Mahindra Bank reported an improvement in asset quality indicators. Gross non-performing assets (GNPA) improved to 1.20% from 1.30% in the previous quarter. On a year-on-year basis, GNPA was reported at 1.20% (Rs 6,017.81 crore) as of March 31, 2026, compared with 1.42% (Rs 6,133.85 crore) at the end of March 2025.

Net non-performing assets (NNPA) eased to 0.25% from 0.31% quarter-on-quarter. Year-on-year, NNPA was 0.25% (Rs 1,262.51 crore) as of March 31, 2026, compared with 0.31% (Rs 1,343.44 crore) as of March 31, 2025.

Slippages for the quarter declined 32% year-on-year to Rs 1,018 crore. The provision coverage ratio (PCR) stood at 79%, compared with 78% as of March 31, 2025.

Balance sheet growth: advances, customer assets, deposits

On the balance sheet, net advances grew 16% year-on-year to Rs 496,009 crore as of March 31, 2026, compared with Rs 426,909 crore as of March 31, 2025. Customer assets, which comprise advances (including IBPC and BRDS) and credit substitutes, rose 14% year-on-year to Rs 545,716 crore as of March 31, 2026.

Total deposits increased 15% year-on-year to Rs 572,456 crore as of March 31, 2026, compared with Rs 499,055 crore a year earlier. The bank reported a CASA ratio of 43.3% at the end of the quarter. The credit-to-deposit ratio stood at 86.6%.

Dividend proposal and the impact of the stock split

The board recommended a final dividend of Rs 0.65 (65 paise) per equity share of face value Re 1 for the year ended March 31, 2026, subject to approval at the ensuing AGM. The bank said the record date and dividend payout date would be communicated later.

The dividend context is also linked to the bank’s stock split that took effect on January 14, 2026, when one equity share of face value Rs 5 was sub-divided into five shares of Re 1 each. This matters for comparisons of per-share dividends across years, since the share count changed after the split.

Stock reaction and one-year performance versus Nifty

Ahead of the results, Kotak Mahindra Bank shares rose about 0.5% on Friday to end at Rs 383.75 on the NSE. The article also cited the BSE close of Rs 382.65, up 0.28%.

Over the last one year, the stock has declined 12.2%, underperforming the Nifty 50, which is down 1.3% over the same period, as stated in the report.

Key metrics table: Q4 FY26 snapshot

Market impact and investor takeaways

The quarter’s headline was a profit beat versus the Bloomberg consensus, supported by a sharp reduction in provisions and improving asset-quality metrics such as GNPA, NNPA, and slippages. At the same time, the reported NIM of 4.67% was lower than the year-ago quarter, keeping focus on margin trajectory even as the cost of funds improved.

From a balance sheet perspective, the 16% year-on-year growth in net advances and 15% rise in deposits indicate continued business expansion into the end of FY26, with a reported CASA ratio of 43.3% and a credit-to-deposit ratio of 86.6%.

What to watch next

Investors will track the AGM timeline and the bank’s forthcoming disclosure on the dividend record date and payout date. Beyond the dividend, the next key datapoints to monitor will be the trend in NIM, the sustainability of lower provisions, and whether the improvement in slippages and NPA ratios continues in the new financial year.