Karur Vysya Bank shares jumped 13 per cent on Tuesday after the bank reported its highest quarterly profit of ₹756 crore for the quarter ended June 2026 (Q1FY27), The stock’s gains came despite the bank maintaining a cautious and moderate growth outlook for FY26-27.
The stock closed 13.06 per cent higher at ₹340.30 on the NSE after hitting a fresh 52-week high of ₹345.35 against the previous close of ₹301.
The management cautioned that the strong Q1 growth should not be considered an indicator of full-year growth at the same pace, as business growth was front-loaded in Q1 and potentially Q2.
Bank maintains credit growth and asset quality guidance
Karur Vysya Bank maintained its credit growth guidance at 1 per cent to 2 per cent over industry growth for the rest of the quarters.
The bank’s full-year Net Interest Margin (NIM) guidance remains at 3.7 per cent to 3.8 per cent. NIM for the next quarter is expected to remain at 4 per cent plus, while the full-year guidance will be reviewed at the end of September.
On asset quality, the bank expects Gross NPA to remain below 1.5 per cent and Net NPA below 1 per cent. Slippage is expected to remain below 1 per cent of the loan book.
Brokerages view
PL Capital raised its NIM estimates for FY27 and FY28 by 5 bps each, resulting in an average 2.7 per cent upgrade to its core PAT estimates. The brokerage retained its valuation multiples, and maintained its target price of ₹345 with a buy rating.
HDFC Securities remained constructive on KVB, and maintained an add rating at a revised target price of ₹345, given its consistently healthy operational performance, stable growth, and benign asset quality.
Kotak Securities assigned a sell call on KVB, with a target price of ₹285, compared with an earlier target of ₹275. The brokerage’s key takeaways said operational excellence remains intact, while strong operating momentum drives another strong quarter.
Kotak Securities also said growth and asset quality remain reassuring, but the margin outlook requires patience. The brokerage added that valuation discomfort overrides strong business performance.