Views on Yes Bank 3QFY2016 Results: Angel Broking

Views of Mr. Vaibhav Agrawal (VP Research - Banking, Angel Broking) on Yes Bank 3QFY2016 Results:

"Yes Bank reported a healthy performance during the quarter with PAT growth of 25.1% YoY to INR 675.7cr, above our expectations. NII for the bank grew at healthy pace of 27.3% YoY, on account of strong growth in advances and Retail & CASA deposits. Reported NIM inched up to 3.4% as compared to 3.3% in 2QFY16. CASA Ratio improved to 26.6% from 22.6% a year ago on the back of savings deposits robust growth of 64.1% Y-o-Y. Advances jumped 26.7% YoY to INR 84,396cr which is a healthy number given the sluggish credit growth in the economy. Non Interest Income continued to deliver healthy growth at 39.0% YoY while operating expenses grew by 29.2% YoY led by growth in staff as well as other operating expenses. On the asset quality front, Gross NPA and Net NPA ratios marginally inched up to 0.66% and 0.22% respectively in 3QFY2016 as compared to 0.61% and 0.20% in 2QFY2016 which remains comfortable. The bank indicated that there has neither been any sale to ARC during the previous four quarters nor the bank has refinanced any loan through 5-25 route.

The bank's asset quality performance has held up well so far. Going forward, we have factored higher provisions and slippages given the bank's corporate exposure to metals and EPC. Even after factoring the higher provisions and slippages, we expect Yes Bank to deliver a CAGR of 20.5% in earnings for FY2015-17E. Currently the stock trades at 1.8x FY2017E ABV. We recommend ACCUMULATE rating on the stock."

Shares of YES BANK LTD. was last trading in BSE at Rs.746.9 as compared to the previous close of Rs. 673.55. The total number of shares traded during the day was 1977738 in over 48043 trades.

The stock hit an intraday high of Rs. 749.5 and intraday low of 651.25. The net turnover during the day was Rs. 1410545565.

Source : Equity Bulls

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