October 2006

1
Kotak Mahindra Bank

• October 2006

2
Journey so far
Restructuring Ford Goldman JVs
BANK
Life Insurance Old Mutual JV
Stock Broking
Mutual Fund
Ford Credit JVs
Goldman Sachs JVs
IPO
Investment Banking
New York
Auto Finance
Dubai London
Trade Finance
2006
1985
1986
1990
2003
2001
1998
1996
1995
1992
1991
In October 2005, Kotak Group acquired the 40
stake in Kotak Prime held by Ford Credit
International (FCI) and FCI acquired the stake in
Ford Credit Kotak Mahindra (FCKM) held by Kotak
Group. In May 2006, Kotak Group bought 25 stake
held by Goldman Sachs in Kotak Mahindra Capital
Company and Kotak Securities
3
Group Structure

• Wealth Management
• Retail branch banking
• Retail lending
• Corporate Banking
• Treasury

100
100
100
100
74
100
100
100
100
Kotak Mahindra Capital Company
KotakSecurities
Kotak Mahindra Asset Management Company
Kotak Forex Brokerage
Kotak Mahindra Trustee Company
Kotak Mahindra Private-Equity Trustee
Kotak Mahindra Prime
Kotak Mahindra Old Mutual Life Insurance
Kotak Mahindra Investments

• Car Finance
• Consumer Finance

• Investment
• Lending

Mutual fund
Interbank forex broking
Trustee companies
26 held by Old Mutual

• Stock broking
• eBroking
• Distribution

• IPOs
• Private equity
• Project advisory
• MA
• Primary Dealership

Life insurance

• All companies are regulated
• Over 7,800 employees
• Presence in 264 cities and towns across India
• Offices in New York, London, Dubai Mauritius
• Around 1.6 mn customer accounts

Kotak MahindraSecurities
Kotak Mahindra (UK)
100
100
Kotak Mahindra (International)
60
100
Kotak Mahindra Inc.
100
Global Investments Opportunities Fund
100
Includes direct and indirect holdings
4
Leadership in the Indian Market

• Winner in 33 categories in the Asiamoney Private
  Banking Poll 2006 including the Best Private
  Bank award in Southern Asia

• Best Investment Bank in India 2006, 2004, 2003

• Best Bond Fund House 2006
• Kotak Bond Regular Plan was ranked the best debt
  fund over 3 years 2006

• 'Kotak Bond Regular Plan' was ranked ICRA-MFR1
  and was the recipient of the Silver Award

• In the Annual Euromoney Private Banking Survey
  Poll for 2006 for India, Kotak Mahindra Bank was
  ranked no. 1 in six categories

• Topped the Bloomberg India MA Financial Advisory
  League table (India announced deals) for the
  calendar year 2005

• Topped the India Advisory Partners Indata League
  table for the calendar year 2005

5
Leadership in the Indian Market

• 1 Book runner/ Lead Manager in terms of value
  of Indian equity offerings (PRIME Database) 2006,
  2005, 2004, 2003

• Best Broker - Kotak Securities 2005

• Best Equity House in India 2005, 2004, 2002-2003
  

• Best Domestic Equity house 2004, 2002-2003

• Best Investment Bank in India 2004

• IFR Asia's India Equity House Award for the year
  2004

6
Assets Liabilities
7
Consolidated Advances

• Retail assets 87 of advances
• NIMs 5.3 (5.1 Q1FY06)
• Net NPA 0.26 (0.33 June 05)
• Stressed assets portfolio Rs 4.19 bn March 06
  outstanding recoverable Rs 24 bn - March 06
  potential for significant returns
• Target 30 growth in advances

Advances Rs 106.5 bn (June 06)
Total Advances Growth
Growth in Advances - June 06 v/s June 05
CAGR 51
8
Retail Liabilities
Overview

• 65 full fledged bank branches across 43 cities
• Target around 110 branches across 65 cities by
  March 07
• Focus primarily on HNI and mass affluent
  population
• Emphasis on personalised advisory solutions
• CASA ratio 16 (12 June 05)
• Significant contribution from distribution of
  financial products

Customer Focus
No. of full fledged Bank branches
High Net-worth Super Affluent Mass
Affluent Mass Retail
Retail Bank
50 of mass affluent reside in 6 cities
9
Wealth Management
10
Wealth Management

• Focus on HNI customers
• Managing wealth of over 3,000 families
• Presence in 14 cities with over 100 relationship
  managers
• Amongst top 3 distributors of equity products in
  India
• Winner in 33 categories in the Asiamoney Private
  Banking Poll 2006 including the Best Private
  Bank award in Southern Asia
• Awards in six categories in Euromoney Private
  Banking Poll 2006
• Best Private Bank for ultra high net worth
  investors

Wide Range of Products
Mutual Funds
Private Equity
Equity Derivatives
Life Insurance
Portfolio Management Services
Real Estate Fund
Structured Products
IPO
11
Asset Management
12
Asset Management
Overview

• Around Rs 182.3 bn (US 4 bn) of assets managed /
  advised by the group
• Alternate asset classes added during FY06
• Private equity India Growth Fund with
  commitments of Rs 7 bn
• Kotak Mahindra Realty Fund with commitments of
  over Rs 4.6 bn
• International tranche launched

Group AUM (Rs bn)
Equity AUM CAGR 188
13
Life Insurance
14
Life Insurance

• JV with Old Mutual
• Group synergies contribute to growth
• Continue investments to build a long-term stable
  business
• Focus on value creation while scaling size
• Q1FY07 premium income up 109to Rs 1,237 mn

Total Premium Income (Rs mn)
First year premium (single _at_ 1/10th) (Rs mn)
CAGR 106
15
Building blocks for growth

• Capability
• 2,120 employees
• 13,800 life advisors
• 226 corporate agents 116 brokers
• Established systems and processes
• Geographical reach
• 51 branches in 39 cities
• Products
• Full suite of products risk, saving and pension
• 15 products Individual 5 products Group 1
  product - Rural

16
Investment Banking
17
Investment Banking
Industry Awards Rankings
KMCC - Investment Banking segment
(Rs mn)
18
Securities
19
Securities
Indias leading securities brokerage firm 8.5
market share in FY06 (6.3 in FY05)

• Strong presence in retail and institutional
  segments
• Institutional sales team in New York and London
• Network of 746 offices (own franchisees) across
  249 cities (515 offices in 181 cities June 05)

20
Securities

• Strong research team
• Wide coverage
• Institutional research 117 companies
• Retail research 150 companies
• Awarded Best Provider of Portfolio Management
  Equities by Euromoney Private Banking Poll 2006
• Over 2,45,000 secondary market customers

KS Average Daily Volumes (Rs bn)
KS PAT (Rs mn)
CAGR 119
21
Financials
22
Consolidated Revenue
Financing
Fees
Insurance Premium
Treasury
Others
brokerage income is net of sub-brokerage
23
Consolidated PAT
For FY06 all numbers are excluding profit on
stake of sale in Hutch
24
Consolidated Ratios
For FY06 all numbers are excluding profit on
stake of sale in Hutch
25
Bank Standalone - Segmental
Rs million
Numbers of the previous period are not comparable
since the segments have been reclassified
26
Summary
27
Value Drivers

• Build retail liabilities distribution business
  110 branches by Mar07
• Focus on wealth management
• Retail and commercial lending with focus on NIMs
• Stress assets business
• Leadership in securities broking
• Integrated corporate investment bank
• Thrust in asset management business across asset
  classes
• Life insurance a long term value creator
• New businesses bullion, custodial services
• International expansion
• Effective utilisation of surplus capital in
  subsidiaries

28
Safe Harbour

• This document contains certain forward-looking
  statements based on current expectations of Kotak
  Mahindra management. Actual results may vary
  significantly from the forward-looking statements
  contained in this document due to various risks
  and uncertainties. These risks and uncertainties
  include the effect of economic and political
  conditions in India and outside India, volatility
  in interest rates and in the securities market,
  new regulations and Government policies that may
  impact the businesses of Kotak Mahindra Group as
  well as its ability to implement the strategy.
  Kotak Mahindra does not undertake to update these
  statements.
• This document does not constitute an offer or
  recommendation to buy or sell any securities of
  Kotak Mahindra Bank or any of its subsidiaries
  and associate companies. This document also does
  not constitute an offer or recommendation to buy
  or sell any financial products offered by Kotak
  Mahindra, including but not limited to units of
  its mutual fund and life insurance policies.
• This document is not an offer of securities for
  sale in the United States of America.  Securities
  may not be offered or sold in the United States
  of America unless they are registered or exempt
  from registration.  Any public offering of
  securities to be made in the United States of
  America will be made by means of a prospectus
  that will contain detailed information about the
  Kotak Mahindra Group and management, as well as
  financial statements.
• All investments in mutual funds and securities
  are subject to market risks and the NAV of the
  schemes may go up or down depending upon the
  factors and forces affecting the securities
  market. The performance of the sponsor, Kotak
  Mahindra Bank Limited, has no bearing on the
  expected performance of Kotak Mahindra Mutual
  Fund or any schemes thereunder.
• Figures for the previous period/ year have been
  regrouped wherever necessary to conform to
  current periods/ years presentation.
• Totals in some columns/ rows may not agree due to
  rounding off.