On Thursday, shares of Kotak Mahindra Bank were down by 10% as the RBI restricted the bank from acquiring new clients via online modes and issuing new credit cards.
RBI’s ban on acquiring new clients
This is likely to prove a setback for the bank as a majority of its business is dependent on online channels, including client onboarding.
A setback for the bank
Following this, many brokerage houses have reduced the price target of Kotak Bank, i.e. Jefferies reduced the target to Rs 1,970 from Rs 2,050.
Reduced price target
This is not the first bank to face restrictions by RBI. In 2020, HDFC Bank faced similar consequences.
Not the first time
The bank’s shares were trading in a range of Rs. 1602 to Rs. 1697.80 on Thursday from its previous closing of Rs. 1842.80.