The shares of India’s fourth largest private sector bank by assets gained 2 percent to Rs 1,773.20 a share after the company received approval from the Reserve Bank of India to acquire Sonata Finance for Rs 537 crore.
At 3:20 p.m., Kotak Mahindra Bank Ltd shares were trading at Rs 1,771.10 on the National Stock Exchange, up Rs 31.60 or 1.86 percent from the previous close price. The company is valued at Rs 3,51,935 crore on the stock exchange.
On October 20, 2023, Kotak Mahindra Bank received approval from RBI to acquire 100 percent of the issued and paid-up capital of Sonata Finance Private Limited. Upon completion of the aforesaid transaction, Sonata Finance will be a Wholly-Owned subsidiary of the Kotak Bank. According to the company’s exchange filing report.
Earlier On February 10, 2023, the Kotak Mahindra Bank had entered into share purchase agreements with the shareholders of Sonata Finance Private Limited (“Sonata”), a Non-Banking Finance Company – a Microfinance Institution registered with the RBI, to acquire 100% of the issued and paid up capital of Sonata, for a total consideration of approximately Rs 537 crore.
The Bank’s interest earned has increased by 40 percent yearly, from Rs 9,164 crore in Q1FY23 to Rs 12,868 crore in Q1FY24. In the same time frame, the company’s net profit increased by 51 percent, from Rs 2,712 crore to Rs 4,109 crore.
In the recent financial year, the company reported a return on equity of 13.34 percent and a return on capital employed of 3.41 percent.
The company promoters hold 25.94 percent of the company as of a recent shareholding pattern, while Foreign institutional investors hold 41.54 percent and retail investors hold a 12.89 percent stake.
Kotak Mahindra Bank is a diversified financial services group engaged in the business of banking and financial services including Retail Banking, Treasury and Corporate Banking, Investment Banking, Stock Broking, Vehicle Finance, Advisory Services, Asset Management, Life Insurance, and General Insurance.
Written by Omkar Chitnis
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