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Today's prices ask more of IndusInd Bank than of Kotak Mahindra Bank.
At current prices, buyers of IndusInd Bank are assuming about 12.5% return on equity against 3.4% in its own record; for Kotak Mahindra Bank it is 16.3% against 13.1%. That shows which share needs more to go right — not which is cheaper. How far each trades from its estimated fair value is in the full valuations.
- Valuation method: both on excess return.
- Size: Kotak Mahindra Bank is worth about 6.8 times IndusInd Bank on the stock market.
- Record: Kotak Mahindra Bank has grown revenue faster: IndusInd Bank compounded at about 7% a year (FY2020–FY2026) and Kotak Mahindra Bank at about 13% (FY2019–FY2026).
- What to watch: normalised profitability at IndusInd Bank; return on equity versus capital at Kotak Mahindra Bank.
| IndusInd Bank | Kotak Mahindra Bank | |
|---|---|---|
| Price | ₹914 | ₹489 |
| Market cap | ₹0.71L Cr | ₹4.86L Cr |
| P/E | 23.7 | 22.6 |
| P/B | 1.08 | 2.68 |
| Fair value 🔒 sign in | ₹0,000 | ₹0,000 |
| Upside 🔒 sign in | +00% | +00% |
| Valued on | Excess return | Excess return |
01Two businesses
A high-return private bank, knocked off course
IndusInd Bank, part of the Hinduja group, is a mid-sized private bank known for vehicle finance, microfinance through Bharat Financial Inclusion, credit cards and corporate lending. For years it earned high margins from these higher-yielding loans.
From finance company to full financial group
Kotak Mahindra Bank grew out of a finance company founded by Uday Kotak in 1985 and became a bank in 2003. Alongside lending and deposits, the group runs one of India's larger broking and investment-banking businesses, a life insurer, an asset manager and a car-finance arm.
02The records side by side
Kotak Mahindra Bank has grown revenue faster: IndusInd Bank compounded at about 7% a year (FY2020–FY2026) and Kotak Mahindra Bank at about 13% (FY2019–FY2026). By revenue, Kotak Mahindra Bank is about 2.0 times the size of IndusInd Bank. IndusInd Bank kept 1.7% of revenue as net profit in FY2026; Kotak Mahindra Bank kept 17.8% of revenue as net profit in FY2026 — a sign of very different business models.
Full ten-year tables and charts are on each company's page: IndusInd Bank · Kotak Mahindra Bank.
03What each price assumes
Work backwards from each share price and you can see what buyers are taking for granted — the rate each company must sustain to justify what it costs, against what its own record supports.
04What decides each one's value
- Normalised profitabilityHow much the bank earns once one-time losses are behind it is the core question.
- Deposit stabilityKeeping depositors confident after the shock protects funding.
- Return on equity versus capitalKotak holds more capital per rupee of loans than most peers, which caps its return on equity unless growth picks up.
- The deposit franchiseLow-cost current and savings deposits are the cheapest funding a bank can have; keeping them is central to its margins.
05What could go wrong
- Further surprisesAdditional write-downs would delay recovery.
- Microfinance stressRural borrower stress can raise defaults quickly.
- Regulatory actionThe 2024 RBI restriction showed how quickly technology lapses can stall growth.
- Slower growth than peersCaution can mean losing share in a strong credit cycle.
06Which is better value?
Sign in free to see which trades further below its worth
- ✓Both fair values per share — each on the method that fits the business
- ✓Every step of both workings — growth, margins and cost of capital, with sources
- ✓Bull, base and bear cases — for each company
- ✓Downloadable reports — the full write-up for each, yours to keep
08Questions people ask
Is IndusInd Bank or Kotak Mahindra Bank better value?
That turns on how far each share trades from its estimated fair value. Both figures, with every step of the working, are in the full valuations, free to view once you sign in. On the public numbers, IndusInd Bank trades at 23.7 times earnings and 1.08 times book value, and Kotak Mahindra Bank at 22.6 times earnings and 2.68 times book value — but multiples alone mislead when two businesses work differently, which is why each is valued on the method that fits it.
What is the difference between IndusInd Bank and Kotak Mahindra Bank?
IndusInd Bank, part of the Hinduja group, is a mid-sized private bank known for vehicle finance, microfinance through Bharat Financial Inclusion, credit cards and corporate lending. Kotak Mahindra Bank grew out of a finance company founded by Uday Kotak in 1985 and became a bank in 2003.
Are IndusInd Bank and Kotak Mahindra Bank valued the same way?
Yes — both on excess return, so their workings compare like for like.
What does today's price assume for IndusInd Bank and Kotak Mahindra Bank?
Worked backwards from the share price, IndusInd Bank needs about 12.5% return on equity and Kotak Mahindra Bank about 16.3% return on equity, against 3.4% and 13.1% in their own records.