Kotak Mahindra Bank shares hit 52-week low after Joint MD resigns

Shares of Kotak Mahindra Bank dropped as much as 4.38 per cent to hit a fresh 52-week low of Rs 1,552.55 apiece, on Thursday. 

The drop came after joint managing director (Joint MD) KVS Manian stepped down from  his role at the bank and its board after 29 years of service. Manian, however, was recently promoted to the role of Joint MD. 

“Losing a long standing KMP is a negative amid many KMP exits in the last one year and on the back of RBI’s recent ban on Kotak,” said Nuvama Institutional Equities in a note.

Analysts at Nuvama Institutional Equities believe that there has been a notable surge in senior departures at the bank within a condensed six-month timeframe, coupled with an attrition rate surpassing industry standards. "Moreover, the RBI's imposition of a digital ban has underscored deficiencies in the digital capabilities that the bank previously touted as a core competency," they said in a recent report.

Considering these factors, analysts at Nuvama have downgraded the stock to ‘Reduce,’ with a target price of Rs 1,530. “We believe the recent changes shall hurt growth and profit at least for 12–18 months,” they said. 

At 10:29 AM, shares of the bank were trading 3.81 per cent lower at Rs 1,561.95 per share. By comparison, Sensex was up 0.30 per cent at 74,708.79 levels.