Shares of Mumbai-based private sector lender Kotak Mahindra Bank Ltd. will be in focus on Monday, June 29, after its MD & CEO Ashok Vaswani said that he will not be seeking reappointment once his tenure ends on December 31, 2026.

Kotak Mahindra Bank's board has also initiated the process for the appointment of its new MD & CEO once Vaswani's term ends, it said in an exchange filing. The process will be completed within the applicable regulatory timelines.

Kotak Mahindra Bank's CEO Succession Plan

According to sources in the know, Kotak Mahindra Bank had informed the Reserve Bank of India of Ashok Vaswani's decision to move on a few weeks earlier, attributing it entirely to personal reasons.

The bank is expected to submit names for the new CEO around four months before Vaswani's term ends, which will be around late-August, early-September. Sources also added that the lender will be submitting a shortlist of three candidates for the consideration of the RBI.

Paritosh Kashyap and Anup Saha are likely to be among the internal candidates that the board may consider, sources said, adding that the shortlist will include both internal and external candidates.

Why Is Nomura Bullish On Kotak Mahindra Bank?

Brokerage firm Nomura has maintained its "buy" rating on Kotak Mahindra Bank with a price target of ₹460.

In a note on Monday, Nomura said that the CEO transition is unlikely to alter Kotak Mahindra Bank's strategic direction.

Among potential successors to Vaswani, Nomura said that Anup Saha, currently the head of Kotak's consumer banking division, appears to be the best placed among internal candidate. Additionally, Saha's RBI-approved whole-time director status de-risks the succession planning process.

The brokerage said that while an external appointment cannot be ruled out, it appears less likely. It also highlighted two other potential candidates in Paritosh Kashyap and Jaideep Hansraj but cited their narrower profile as a hurdle.

However, Nomura warned that an external hire could create near-term uncertainty for the lender.

Why Is Jefferies Bullish On Kotak Bank?

Jefferies has also maintained its "buy" recommendation on Kotak Mahindra Bank with a price target of ₹450.

The brokerage also cited Anup Saha as a key internal contender, although a six-month process inclusive of external candidates may create an overhang.

Jefferies cited succession quality and durability as the key factors to Kotak's growth and re-rating prospects.

41 analysts have coverage on Kotak Mahindra Bank, of which 34 have a "buy" recommendation on the stock, five say "hold", while two have a "sell" rating on the lender.

Shares of Kotak Mahindra Bank ended 1% higher on Thursday at ₹409.75. The stock is still down 8% so far this year.