Buy YES Bank; target of Rs 438: Prabhudas Lilladher

Prabhudas Lilladher is bullish on YES Bank has recommended buy rating on the stock with a target price of Rs 438 in its research report dated July 25, 2018.

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September 18, 2018 / 14:17 IST

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on YES Bank

Yes Bank's earnings were in-line with expectations at Rs12.6bn (PLe: Rs12.7bn) but was on back of strong other income (Fx/Debt market led/SR redemption) and control on opex. NII grew slower on pressure from cost of funds and interest reversals on slippages. Bank used higher other income to enhance provisions on GNPAs, while also had hit of MTM on investments but has chosen to make provisions over 4 quarters. We believe corporate book growth to continue for some time ahead, but retail mix should improve faster, while concerns on margins should start abating from H1FY19 end onwards and slippages of this quarter should see recovery keeping asset quality steady by FY19 end with improved PCR towards 60%.

Outlook

Valuations discount to large peers remains high and should narrow going ahead. We maintain BUY with TP of Rs438 based on 2.9x Mar-20 ABV.

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