Kotak Mahindra Bank Share Price: Kotak Mahindra Bank shares have declined by 10 percent. Reserve Bank of India has stopped Kotak Mahindra Bank from adding new customers and issuing credit cards through online and mobile banking immediately due to non-compliance with IT norms. RBI said in a statement that this action has been taken after finding serious flaws in the IT risk management and information security management of Kotak Mahindra Bank. After the RBI ban, many brokerages have reduced confidence in Kotak Mahindra Bank shares. Some brokerages have reduced the rating and target price of the stock. Despite this, the stock has declined.

Kotak Mahindra Bank shares opened in the red at Rs 1675 on BSE in the morning. Immediately it fell 10 percent from the last closing price to a low of Rs 1658.75 and touched the lower price band. But the lower circuit did not work. After that, the lower circuit limit for intraday has been increased to 15 percent. Now, if the stock reaches a low of Rs 1,566.60, it will hit a lower circuit. The market cap of the bank has come down to Rs 3,29,746 crore.

According to an RBI statement, these steps were necessitated by the significant concerns raised by the bank's information technology (IT) audit of the bank for the financial years 2022 and 2023 and the bank's continued failure to address these concerns promptly. RBI had also banned HDFC Bank from issuing new cards and starting new digital initiatives after facing technical difficulties on Thursday in December 2020. However, this ban was lifted in March 2022.

Regarding the action against Kotak Mahindra Bank, the RBI said, "Serious lapses and non-compliances were observed in the areas of IT data management, user access management, vendor risk management, data security, and data leakage prevention strategy, business continuity and post-crisis recovery promises, etc." ." In such a situation, Kotak Mahindra Bank has been directed to ban adding new customers and issuing new credit cards through its online and mobile banking with immediate effect. However, the bank will continue to provide services to its existing customers including credit card holders. These restrictions will be reviewed upon completion of a commercial external audit initiated by the Bank with the prior approval of RBI.

Brokerage's stance on Kotak Mahindra Bank shares

Citi has rated Natural on Kotak Mahindra Bank. He has set a target of Rs 2040 per share. He says that RBI's action will hurt growth, NIM, and fee income. The speed of the branch area will have to be increased.

CLSA has given an outperform rating to Kotak Mahindra Bank. He has set a target of Rs 2,100 per share. He says that there will not be much impact on profits. If the ban does not last long then it will have no effect.

Jefferies has given a Hold rating on Kotak Mahindra Bank. He has reduced the target on it from Rs 2050 to Rs 1970. He says that such a problem had arisen in HDFC Bank in 2020. At that time HDFC Bank took 9-15 months to find a solution. If Kotak Bank is affected for more than 6 months, its income will be affected.