We can use powershell command to change sharepoint user display name. Set-SPuser -identity “User name” -DisplayName “Display Name” -web Web url
Eg: Set-SPuser -identity “i:0#.f|fwamembershipprovider|kdc1” -DisplayName “kdc1” -web http://xyz:117/
In case you get access denied while changing the display name, run powershell as administrator/Farm admin.