Hold Yes Bank; target of Rs 230: ICICI Direct

ICICI Direct's research report on Yes Bank

Putting an end to the ambiguity around extension of Rana Kapoor, MD & CEO of the bank, RBI has curtailed his tenor that will now expire on January 31, 2019. The board is scheduled to meet on September 25, 2018 to decide the future course of action. The term of Rana Kapoor, was ending on August 31, 2018. The board and shareholders had approved Kapoor’s extension for a period of three years while RBI’s approval was awaited.

Outlook

Therefore, we revise our FY20E P/ABV multiple downwards to 1.7x and consequently downgrade our target price to Rs 230 per share (earlier Rs 375). Amid the recent correction in the stock price, we maintain our HOLD rating on the stock.