Buy Yes Bank; target of Rs 900: Axis securities

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26 Aug, 2025 12:21

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Axis securities's research report on Yes BankYes Bank reported a robust quarter marked by improvement in CASA ratio and margin (10 bps QoQ to 3.4%), robust loan growth (~27% YoY), strong traction in other income (up 39% YoY) and largely stable asset quality. As a result, the PAT was higher at Rs 6.8 bn (+25% YoY). Amidst apprehension on asset quality on account of RBI’s assessment on re-classification of loans, YesBank surprised with a largely stable asset quality. GNPL ratio was just up by 5 bps QoQ at 0.7%. No new loan was restructured and nothing slipped to NPLs from the existing restructured pool. There was no account sold to ARCs and nothing was re-financed through 5:25 route. Management does not foresee major pipeline of stressed loans due to RBI’s assessment on asset quality and has lowered its credit cost guidance for FY16 to a maximum of 50 bps.Given strong loan growth, healthy earnings momentum and stable asset quality, we retain our BUY rating with TP of Rs 900 (2.3x FY17E ABV),implying 20% upside from CMP. At CMP of Rs 747, Yes Bank trades at 2.3x/1.9x FY16E/17E ABV of Rs 325/Rs 383.For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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