Harish Dhawan 11 October 2026

Kotak Mahindra Bank Share Price Target at Rs 500: Prabhudas Lilladher

Prabhudas Lilladher has retained its BUY call on Kotak Mahindra Bank and raised its target price to Rs 500 from Rs 480, implying about 20% upside from the current market price of Rs 417. The trigger is the Reserve Bank of India's approval of Anup Saha as managing director and chief executive for three years from Jan. 1, 2027. Saha, who joined Kotak in January 2026 after more than eight years at Bajaj Finance and 14 at ICICI Bank, brings deep retail lending experience. The brokerage reads the choice as continuity, but wants answers on surplus capital, gold loans and a shrinking unsecured book.

Target raised · Rs 480 → Rs 500

BUY · RETAINEDEVENT UPDATEPL CAPITAL · BANKS

Kotak Mahindra Bank Names Its Next Chief, and PL Capital Nudges the Target to Rs 500

The RBI has cleared retail-lending specialist Anup Saha to run the bank from January. The new chief inherits more capital than the bank can profitably use.

The Levels, Stub by Stub

Rating

BUY

CMP

Rs 417

Target

Rs 500

Upside

~20%

52-week range

Rs 345 – Rs 453

Basis

2.0x Sept. 2028E core adjusted book

Market capitalisation about Rs 4,14,800 crore.

From Hire to Helm in Under a Year

The RBI, in a letter dated Sept. 30, 2026, approved Saha's appointment as MD and CEO for a three-year term starting Jan. 1, 2027. He succeeds Ashok Vaswani, and both Vaswani and Chairman C. S. Rajan have backed him to lead the next phase of growth.

JAN

2026

Joins Kotak

MAR

2026

Executive director: retail, analytics, marketing

SEPT 30

2026

RBI approval letter

JAN 1

2027

Takes charge for three years

The Resume Behind the Approval

Anup Kumar Saha

32+ years · 25 in retail and MSME lending

Kotak Mahindra Bank

Since January 2026; executive director for retail, analytics and marketing.

Bajaj Finance 8+ yrs

Consumer finance, MSME, operations and digital; rose to MD and CEO, per the report.

ICICI Bank 14 yrs

Retail secured assets, collections, credit cards and structured finance.

Earlier

GE Capital and BHEL.

B.Tech, IIT KharagpurMBA, IIM Lucknow

PL Capital calls the appointment a positive. The market had expected Saha to succeed Vaswani since his elevation to the board, and nine months inside the bank point to continuity rather than a reset.

The In-Tray Waiting for Him

Memo

To: Incoming MD and CEO, Kotak Mahindra Bank

Re: Four questions PL Capital says need answers

Grow faster. Loans are compounding at 14-16%. With capital this deep, the house argues the bank can run harder; it pencils in 16.5% loan growth for FY27E and 15% a year after.

Fix gold loans. Kotak's share of the gold-loan market is “not meaningful,” and the bank needs a clear strategy.

Rethink unsecured. Gold credit is cannibalising unsecured loans, whose share of the book is declining.

Put the surplus to work. Common equity tier-1 of about 22% is dragging return on equity to roughly 11%, despite a superior return on assets near 1.9%.

The Capital Paradox, Quarter by Quarter

The fourth item is the one investors feel most. Kotak has held tier-1 equity between 20.9% and 22.4% for eight straight quarters, yet core return on equity has slipped from 12.2% to 10.6%.

CET-1 ratio vs core RoE, Q2FY25 to Q1FY27 (%)

Reported return on equity looked better in Q1FY27 at 12.4%, but the house's core measure, which strips out one-offs, was 10.6%.

Estimates Barely Move

The leadership news did not change the numbers much. PL Capital trimmed its forecasts by less than 1% across the board.

FY27E changeMetricFY28E change

-0.6%

Net interest income

-0.5%

-0.7%

Operating profit

-0.7%

-0.4%

EPS

-0.8%

Bar length scaled to a 1% maximum cut. EPS now Rs 17.9 (FY27E) and Rs 18.9 (FY28E), from Rs 18.0 and Rs 19.1.

Standalone (Rs crore)	FY26	FY27E	FY28E	FY29E
Net interest income	30,010	33,347	38,214	43,341
Core pre-provision profit	20,674	23,296	27,372	31,514
Net profit	14,008	17,792	18,837	21,608
Core net profit	12,958	15,084	17,525	20,295
EPS (Rs)	14.1	17.9	18.9	21.7
Return on equity (%)	11.1	12.3	11.5	11.8
Return on assets (%)	1.9	2.1	2.0	2.0
Price / adjusted book (x)	2.7	2.8	2.5	2.2

Asset quality remains a strength. In Q1FY27, gross bad loans stood at 1.2%, net at 0.3%, and provision coverage at 77.8%. Advances reached about Rs 5,12,249 crore, up 15.2% from a year earlier, while deposits grew a slower 11.7%, lifting the loan-to-deposit ratio to 89.4%.

The Target Returns to Rs 500

PL Capital keeps its 2.0x multiple and rolls valuation forward to September 2028 core adjusted book, lifting the target to Rs 500 from Rs 480. The target last stood there in April, before a May cut.

PL Capital target (step line) vs share price (dots), Rs

Target for investors: Rs 500 over the house's horizon, about 20% above Rs 417. At 2.5x FY28E adjusted book, the stock is not cheap, and it trades nearer its 52-week high of Rs 453 than its low. Investors may prefer to accumulate gradually.

What Could Go Wrong

Execution: The house says execution “remains key.”

Idle capital: If surplus capital is not deployed, core return on equity could stay stuck near 11%, capping the multiple.

Funding: Deposits grew just 11.7% in Q1FY27; the model needs 17.4% in FY27E to fund its loan growth.

Product mix: A late push into gold loans and a shrinking unsecured book could weigh on yields.

Editor’s note

The annual table gives FY26 CET-1 as 20.6% and capital adequacy as 21.7%, but the quarterly table shows 21.3% and 22.4% for Q4FY26, the same date.

Book value per share for March 2026 is Rs 272.1 in the quarterly table and Rs 136.0 in the annual one, exactly double, suggesting a different share basis. We use the annual figures.

The forward multiples are calculated at a share price of Rs 422.8, not the Rs 417 market price on the cover.

Saha's 25 years are “retail/MSME lending” in the summary but “banking and non-banking financial services” in the body.

The report does not print a bridge from 2.0x core book to Rs 500, and this event update carries no risk list; the risks above are drawn by TopNews from its content.

Sources: PL Capital (Prabhudas Lilladher), Kotak Mahindra Bank event update dated Oct. 1, 2026 (analysts Gaurav Jani, Adarsh Shetty and Tarang Nandwana); Reserve Bank of India approval as cited in the report. Charts plot the house's printed figures. Rupee figures converted to crore.

Disclaimer: Investments in the securities market are subject to market risks. This TopNews report is based on a brokerage research report and is for information only; it is not investment advice. Read all related documents carefully and consult a registered financial adviser before investing.

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