Kotak, Axis and IndusInd Bank Shares Move After the Q2 Update: Advances, Deposits, CASA Ratios and FCNR(B) Effects Compared, How the Stocks Reacted on 6 October and the Key Data Investors Should Know

The Q2 update season for private banks produced sharp moves on Tuesday, 6 October, as Kotak Mahindra Bank, Axis Bank and IndusInd Bank reported provisional September-quarter numbers. Kotak gained as much as about 4%, Axis rose about 1.3% to around Rs 1,237 and IndusInd about 1%, while IDFC First Bank fell about 3%.

If you are searching for how Kotak Mahindra Bank shares, Axis Bank shares and IndusInd Bank shares compare after the Q2 update, this article covers the Q2 update for each bank, CASA and term deposits mix, the credit-deposit ratio, the FCNR(B) swap effect, the stock reactions, how Motilal Oswal read the data, the RBI policy and the risks. These are provisional business numbers and not financial results, so margins and asset quality come later.

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Q2 Update Compared: Kotak, Axis and IndusInd Bank

Metric	Kotak Mahindra Bank	Axis Bank	IndusInd Bank
Advances	Net Rs 5,77,094 crore, up 24.7% YoY and 12.7% QoQ	Gross Rs 13.85 lakh crore, up 22.7% YoY	Net Rs 3,62,393 crore, up 11.2% YoY
Deposits	Rs 6,51,491 crore, up 23.2% YoY and 13.7% QoQ	Rs 14.52 lakh crore, up 20.7% YoY and 5.8% QoQ	Rs 4,29,038 crore, up 10.1% YoY and 3.4% QoQ
CASA deposits	Rs 2,49,105 crore, up 11.3% YoY and 7.8% QoQ	Rs 5.30 lakh crore, up 10.6% YoY and 1.5% QoQ	CASA ratio of 28%
CASA ratio	38.2%, from 40.3% in Q1	36.5%, from 38% in Q1	28%, from 29.4% in Q1 and 30.7% a year ago
Share price move on 6 October	Up as much as about 4%	Up about 1.3% to about Rs 1,237	Up about 1%

In the Q2 update all three banks grew deposits, but term deposits grew faster than CASA, which raises funding costs. Kotak's credit-deposit ratio eased to 88.6% from 89.4%, and Motilal Oswal noted that Kotak's loan and deposit growth beat its estimates while the CASA mix fell sharply.

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Kotak Mahindra Bank Q2 Update: Strong Growth, Lower CASA Mix

Kotak's average net advances rose 22.1% to Rs 5,46,963 crore, while period-end advances grew faster at 24.7%, which means the Q2 update shows loans picked up late in the quarter. CASA deposits grew Rs 25,314 crore year on year, but total deposits grew twice as fast, so the CASA ratio dropped about two percentage points quarter on quarter.

Axis Bank Q2 Update: FCNR(B) Loans Inflate the Headline

The Axis Bank Q2 update said loans extended by its international branches against FCNR(B) deposits stood at Rs 43,800 crore. Excluding those, gross advances would have grown 18.8% year on year and 5.3% quarter on quarter, against 22.7% reported, and total deposits would have grown 17.0% year on year, not 20.7%. Term deposits grew 27.3% year on year, and average deposits grew 22.5% year on year and 7% quarter on quarter.

Axis Bank metric	Reported	Excluding FCNR(B) loans
Gross advances growth, YoY	22.7%	18.8%
Gross advances growth, QoQ	Higher	5.3%
Total deposits growth, YoY	20.7%	17.0%
Term deposits growth, YoY	27.3%	21.3%
CASA mix	36.5%, from 38%	Not adjusted

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IndusInd Bank Q2 Update: Slower Growth, Lower CASA

In its Q2 update IndusInd's advances rose 11.2% and deposits 10.1%, slower than peers, but the bank mobilised $3.51 billion of FCNR(B) deposits under the RBI swap window, and retail and small business deposits reached Rs 2,14,504 crore. Its CASA ratio fell to 28% from 29.4% in Q1 and 30.7% a year ago, the lowest of the three, which pressures margins.

What the Q2 Update Means for Bank Stocks

1. Credit growth is healthy at the large private banks, roughly 22% to 25% at Kotak and Axis.
2. Deposit mix is the weak spot, because term deposits and FCNR(B) money cost more than CASA.
3. Margins are the next test, so the full Q2 results matter more than the business update.
4. Rate moves matter: the RBI policy on 7 October could raise deposit and lending rates.
5. Valuation and quality differ: IndusInd is recovering from earlier problems, while Kotak and Axis grow faster.

Bank stock	Reaction on 6 October	Key watch item
Kotak Mahindra Bank shares	Up to about 4%	CASA ratio and credit-deposit ratio
Axis Bank shares	Up about 1.3% to about Rs 1,237	FCNR(B)-adjusted growth and margins
IndusInd Bank	Up about 1%	CASA at 28% and growth recovery
IDFC First Bank	Down about 3%	Reaction to its own update

Risks Behind the Bank Q2 Update

Provisional data: A business update does not show margins, profit or asset quality.

Funding cost: A lower CASA mix raises the cost of funds and can squeeze margins.

FCNR(B) flows: Swap-window deposits can reverse and inflate headline growth.

Rate hike: The RBI decision on 7 October can move bank shares both ways.

Market mood: Bank Nifty is near 54,700 after a weak two months, so sentiment is fragile.

What to Watch Next After the Q2 Update

1. The RBI policy decision on 7 October and its effect on deposit and lending rates.
2. Q2 FY27 results in mid to late October for net interest margin and credit costs.
3. CASA trends and the credit-deposit ratio at each bank.
4. Brokerage target changes after the Q2 update.
5. FCNR(B) deposit retention as the swap window winds down.

Conclusion

The Q2 update lifted Kotak, Axis and IndusInd Bank shares by about 1% to 4% on 6 October on healthy loan and deposit growth, led by Kotak's 24.7% advances growth. CASA ratios of 38.2%, 36.5% and 28% and the FCNR(B) boost at Axis show the quality issues behind the headline. The RBI policy on 7 October and the Q2 results that follow this Q2 update will decide the next move. Consult a SEBI-registered advisor before making any decision.

Frequently Asked Questions

What did Kotak Mahindra Bank report in its Q2 update?

Ans. Net advances rose 24.7% to Rs 5,77,094 crore, deposits rose 23.2% to Rs 6,51,491 crore, and CASA rose 11.3% to Rs 2,49,105 crore, with the CASA ratio at 38.2%.

What did Axis Bank report in its Q2 update?

Ans. Gross advances rose 22.7% to Rs 13.85 lakh crore and deposits rose 20.7% to Rs 14.52 lakh crore. Excluding FCNR(B) loans, advances grew 18.8%.

What did IndusInd Bank report in its Q2 update?

Ans. In its Q2 update, net advances rose 11.2% to Rs 3.62 lakh crore and deposits rose 10.1% to Rs 4.29 lakh crore, with the CASA ratio at 28%.

How did Kotak Mahindra Bank shares, Axis Bank shares and IndusInd shares react?

Ans. After the Q2 update, Kotak gained up to about 4%, Axis about 1.3% and IndusInd about 1% on 6 October, while IDFC First Bank fell about 3%.

Why is the CASA ratio falling?

Ans. Depositors are moving savings into higher-rate term deposits, and banks are also raising FCNR(B) deposits, so CASA growth lags total deposit growth.

What is FCNR(B) and why does it matter?

Ans. FCNR(B) deposits are foreign currency deposits that banks raised under an RBI swap window. They lift headline deposit and loan growth but cost more.

When are the Q2 results for these banks?

Ans. The full results usually follow in mid to late October. Check the exchange filings for exact dates.

Are bank stocks a good buy after the Q2 update?

Ans. This article does not constitute investment advice. Growth is healthy but deposit quality and margins matter. Consult a SEBI-registered financial advisor.