Kotak Mahindra Bank gains; Deutsche upgrades to buy

Shares of Kotak Mahindra Bank up as much as 3 per cent after Deutsche Bank upgrades the stock to "buy" from "hold" and increases the price target to Rs 1,080 from Rs 770.

High operating leverage in banking, broking and other sectors is driving strong earnings, while investments in its distribution network is resulting in sustained growth, Deutsche said in a note.

"The stock being a big beneficiary of capital market revival, with benefits accruing across business segments," it said.

Deutsche has increased earnings estimates for Kotak by 7 per cent for FY15 and 14 per cent for FY16 and expects consolidated earnings to grow at a 28 per cent CAGR over FY14-17.

Shares are up 2.7 per cent to Rs 924.45 at 12:41 p.m.

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