Kotak Mahindra Bank is well positioned to capitalise on growth opportunities and it will expand its market share by targetting new customers to cross-sell products, leading to higher growth and profitability, the banks chairman has said.
Addressing the shareholders of Kotak Mahindra Bank (Kotak) at the Annual General Meeting (AGM) on August 27, 2022, Chairman Prakash Apte said the Indian economy has started recovering to reach pre-pandemic levels, and a host of factors are driving the countrys growth prospects, according to a regulatory filing by the bank on Sunday.
“Widespread vaccine coverage, waning impact of the pandemic and successive waves and growing preference as alternative manufacturing destinations are driving Indias growth prospects,” Apte said.
With a growth rate of 21 per cent in Kotaks consolidated profit after tax of Rs 12,089 crore in FY22, he said the groups (Kotak) results for the financial year demonstrate the strong fundamental growth in India.
Albeit, concerns remain on twin global headwinds of high inflation and increasing interest rates, he cautioned.
Kotak will continually evaluate its strategy against the macro economic realities as they evolve and will respond, with a view to grow its business as a sustainable franchise, he told the shareholders.
“The Group believes that, with sound risk management and strong capital adequacy ratio, it is well positioned to capitalise on the growth opportunities offered by India of the future.
“The Group aims to expand its market share in Indian financial services by increasing the customer base across the Group, and enhancing the customer experience, which will lead to higher cross-selling of products, thereby contributing to the future growth and profitability,” the Chairman said.
Kotak Mahindra Banks standalone net profit in the fiscal ended March 2022 was up by 23 per cent at Rs 8,573 crore. Besides, Kotak Group will actively look for inorganic growth potential in domestic financial services.
It can be either in businesses or assets that enable Kotak to expand its market share and allows entry into an industry, customer, or geographic segment that it is currently not present. Or businesses which provide new capabilities.
Strategic priorities are focused around customers, technology and talent to build a future-ready financial services group, Apte said.
Like others, the banking industry also witnessed a wave of changes from business models to operations and reoriented to a “digital-first” world. “New operating models around customers are taking shape, processes are evolving to keep governance in focus, and technological advancements are becoming a constant companion. Thus, from traditionally being inward looking, banks are adopting an outside-in approach,” the Chairman said.
On Environment, Social & Governance (ESG) and Corporate Social Responsibility (CSR), he said systemic efforts are underway to sensitise the workforce on ESG aspects and empower each employee to drive impact through their professional pursuits.
“An ESG Policy Framework has been developed which explains our approach to align the Groups business strategy, processes and disclosures with national and international standards and frameworks.” He said efforts to minimise operational carbon footprint are focused on digitisation of products and services, procurement of renewable energy, responsible utilisation of resources and waste recycling.
The Group offers diversified financial services ranging from banking, stock broking, insurance, and asset management among others.
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