Financial Performance:

• Revenue:
  • FY'25 consolidated profit stood at ₹22,126 crore, up 21% YoY (5% YoY excluding the gain on divestment of KGI of ₹3,013 crore).
  • Standalone Bank profit was ₹16,450 crore, up 19% YoY (excluding KGI gain, profit was ₹13,720 crore).
• Net Income:
  • Consolidated net income for Q4 FY'25 was ₹4,933 crore.
• Earnings Per Share (EPS):
  • Book value per share grew 21% YoY to ₹792.
• Operating Income:
  • NII for the quarter improved to ₹N/A; last year's NII included one-off items affecting YoY comparison.
• Gross Margin:
  • NIM for FY'25 was 4.96%, down 36 bps YoY.
• Operating Margin:
  • Operating cost for FY'25 was at 12.5% of total operating expenses.
• Cash Flow from Operations:
  • Cash flow specifics were not detailed; however, the overall performance reflects strong operational management.
• Capital Expenditures:
  • Technology investments were 12.5% of total Opex. No delays reported.
• Debt and Liquidity Position:
  • Capital adequacy at consolidated level remained healthy at 23.3%, with CET-1 at 22.3%.
• Other Key Financial Metrics:
  • ROE at 13.12% and ROA at 2.36% for FY'25 (excluding KGI gain).

Business Updates & Strategic Developments:

• Product or Service Launches:
  • Launched new mobile banking and 811 apps.
  • Introduced ‘Solitaire’ for affluent segments.
• Market Expansions:
  • Strengthened propositions for corporate and SME customers.
• Acquisitions or Divestitures:
  • Acquisition of Standard Chartered personal loan portfolio completed.
• Regulatory Approvals or Updates:
  • Transitioned through RBI embargo without exceeding initial cost estimates.
• Legal or Compliance Issues:
  • No significant legal or compliance issues reported.

Industry Outlook:

• Sector-Wide Trends:
  • Credit strains in the microfinance industry and rising delinquencies in unsecured loans noted.
• Macroeconomic Factors Affecting the Industry:
  • Global uncertainties from trade, geopolitical issues, and interest rate trends.
• Competitive Landscape:
  • Kotak positions itself with a diversified financial services model, emphasizing customer-centricity.

Export Business & International Operations:

• Export Revenue & Growth:
  • No specific export revenue reported; focus remains on domestic market.
• International Market Expansions & Challenges:
  • No significant international expansion mentioned.

Domestic & International Business Risks:

• Domestic Market Risks:
  • Credit cost pressures due to rising delinquencies and industry shifts in unsecured lending.
• Operational Risks:
  • Technology issues impacting customer acquisition in previous periods.
• Economic & Macroeconomic Risks:
  • Concerns about interest rate trends and potential economic slowdowns.

Forward Guidance & Future Targets:

• Revenue & EPS Projections:
  • Management aims for growth aligned with nominal GDP growth of 1.5x to 2x.
• Management's Confidence Level on Meeting Targets:
  • Management expresses confidence in strategy execution despite noted challenges.

Promises & Commitments Tracking

New Commitments Made in this Call:

• Specific Goals or Targets with Timelines:
  • Continued focus on moving from product-centric to customer-centric approach.
  • Launch of brand campaign ‘Hausla Hai Toh Ho Jayega’ to enhance group brand recognition.

Status of Previous Promises:

• Completed/Fulfilled Commitments:
  • Transition through the RBI embargo successfully and technology fixes implemented.
• Ongoing Commitments (In Progress):
  • Enhancements in customer relationship management and digital offerings.

Capital Expenditure & Investment Plans:

• Planned vs. Actual Execution:
  • On track with technology investments and marketing initiatives.
• Major Investment Areas:
  • Emphasis on technology for efficiency and customer experience.

Profitability & Margin Analysis:

• Margin Expansion or Contraction:
  • NIM contraction due to higher cost of funds and reduced mix of retail unsecured advances.
• Cost Management Measures:
  • Focus on optimizing cost of funds with a CASA ratio of 43%.

Shareholder Returns & Capital Allocation:

• Dividend Announcements:
  • No new dividends announced in the call.
• Debt Repayment & Capital Management:
  • Ongoing focus on maintaining a healthy capital adequacy ratio.

Q&A Session Insights:

• Key Questions Asked by Analysts:
  • Inquiries regarding provisioning coverage and margins.
• Management's Responses & Clarifications:
  • Management acknowledged improvements in slippages and emphasized prudent risk management.
• Unanswered or Avoided Questions:
  • No significant questions were avoided, but details on specific future projections were cautious.