Widening divergence between private and PSU banks likely to benefit Kotak Mahindra: Harendra Kumar

In a chat with ET Now, Harendra Kumar, Managing Director-Institutional Equities, Elara Capital, shares his views on Kotak Mahindra Bank. Excerpts:

ET Now: Kotak Mahindra Bank is very expensive yet the market appetite is insatiable for the Bank.

Harendra Kumar: Firstly, they manage their business extremely well in terms of their NPAs. Second thing is the capital market coming back their business that was not getting discounting in this bear market will start throwing up positive numbers out there as well. Also, the private bank space has very few options given that you have a lot of consensus in terms of Axis Bank, ICICI Bank and IndusInd Bank. So at a structural level, Kotak stands out up there and there is a polarisation trade that is also underway given that PSU bank numbers are little volatile. So you will see continuing flow of money into some of these stocks. So the divergence between these private and PSUs is only likely to widen and in that Kotak will benefit immensely.