Yes Bank Q1 FY18 Result Update Rating - ACCUMULATE - Arihant Capital Markets

Total Advances grew by 32% to Rs 1,39,972 crore as at Q1 FY18. Corporate banking accounted for 68.1% of the Advances portfolio while Retail & Business Banking constituted 31.9% due to increase in consumer banking and business banking. Total Deposits grew by 22.6% to Rs 1,50,241 crore. The CASA deposits grew by 52.2% y-o-y to Rs 55,215 crore taking up the CASA ratio to 36.8% up from 29.6% in the corresponding quarter on. Savings account deposits increased by 45.8% Y-o-Y. Current account deposits increased by 66.6%.

Aided by strong growth in advances and deposits, NII jumped by 44% to Rs 1,810 crore and non-interest income increased by 17.8% and stood at Rs 1132 crs. Net profit for the bank grew by 32% Y-o-Y to Rs 965 crores.

Gross NPAs declined QoQ from 1.5% to 0.97%, and net NPAs also declined to 0.39% from 0.8%. There was no new restructuring or sale to ARC during this quarter. One account (0.07%) was upgraded during the quarter from Restructured to Standard Asset due to satisfactory conduct during the prescribed period.

Total Capital funds for the bank stood at Rs 32,541 crores (45%) of which Tier 1 capital stood at 13.8%. Total risk weighted assets stood at Rs 1,85,221 crores. The daily average liquidity coverage ratio stood at 88.3%.

- As on 30 June, 2017 total headcount for the bank stands at 20,851, an increase of 726 employees in the quarter and 4,430 incremental employees since June 30, 2016. The Bank's branch network stood at 1020 branches, an addition of 20 branches in the quarter and total ATM network stands at 1,796. Cost to income ratio increased to 42.1% from 41.1% Y-o-Y.

Valuation

YES Bank has delivered another quarter of satisfactory performance across key financial parameters of growth and profitability driven by expansion in NIMs to 3.7%. Bank's comprehensive product offerings continue to enable a healthy and granular credit growth. We have valued the bank at 3.9(x) its FY19E adj. book value and have arrived at fair value of Rs 2013 per share. At CMP of Rs 1,786, the stock is trading at P/ABV(x) of 3.5x its FY19 ABV. We have 'ACUMULATE' rating on stock.

Shares of YES BANK LTD. was last trading in BSE at Rs.1785.25 as compared to the previous close of Rs. 1829.55. The total number of shares traded during the day was 149190 in over 7416 trades.

The stock hit an intraday high of Rs. 1838.8 and intraday low of 1774.75. The net turnover during the day was Rs. 267422089.

Source : Equity Bulls

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