Yes Bank - March 2013 Results Preview - Motilal Oswal

- Loans and deposits are expected to grow at 22% YoY and 18% YoY respectively.

- Margins are expected to improve 5bp+ led by lag impact of deposit repricing and improvement in CASA ratio. While yield on funds will continue to remain under pressure, resumption of loan growth rather than just investment substitutes would help margins.

- Growth in fee income, ex-financial markets, is expected to remain strong at 33%+ YoY led by healthy YoY growth of 20%+ in financial advisory (though on a QoQ basis it is expected to decline), transaction banking income and strong growth in fees from third party distribution.

- YES Bank continues to demonstrate strong asset quality performance even as the economic environment continues to pose challenges. We expect the healthy trend to continue.

- The stock trades at 2.1x FY14E and 1.7x FY15E BV, and 9.2x FY14E and 7.5x FY15E EPS. Maintain Buy.

Source : Equity Bulls

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