Yes Bank Share Price Erases Losses After Falling Over 1% On Q2 Business Update

Yes Bank share price erased losses after falling over 1% on Friday on the September-quarter business update. While the private sector lender reported strong year-on-year growth in both deposits and advances, a sequential decline in its liquidity coverage ratio dampened sentiment.

Business Update For Yes Bank (Q2)

• Total Loans & Advances: Up 13.1% YoY at Rs 2.36 lakh crore

• Total Deposits:  Up 18.3% YoY at Rs 2.77 lakh crore

• CASA Ratio: 32% versus 30.8% QoQ  

• Liquidity Coverage Ratio: 131.9% versus 137.8% QoQ  

Morgan Stanley has an 'underweight' rating on the stock with a target price of Rs 16.60, implying a potential downside of 25.9% compared to the previous close. The brokerage is awaiting more details from the financial results on loan mix, margin progression, and asset quality.

Nomura has a 'neutral' stance on the stock with a target price of Rs 17, implying a potential downside of 24.2% compared to the previous close. The brokerage noted that the banks’ return profile, though improving, remains significantly lower than peers, trading at 1.4x one-year forward Book Value Per Share, which captures the positives. 

Yes Bank stock fell 1.56% in early trade on the quarterly business update, but erased losses to rise as much as 1.24% to Rs 22.13 apiece on the NSE. The stock was trading 0.55% higher at Rs 21.98 apiece, compared to a 0.09% advance in the benchmark Nifty 50 and a 0.25% advance in the Nifty Bank and as of 9:57 a.m. 

It has risen 25.58% in the last 12 months and 2.42% on a year-to-date basis. The total traded volume so far in the day stood at 1.9 times its 30-day average. The relative strength index was at 30.21.

Two out of the 12 analysts tracking Yes Bank have a 'hold' rating on the stock and ten suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 21.1%.