Yes Bank Q1 Results: Profit Beat Estimates, Asset Quality Improved

Yes Bank Q1 Results
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Yes Bank reported its Q1 earnings and earnings were above expectations. The share price of Yes Bank was Rs 14.05 per share on Tuesday morning.

Yes Bank Earnings Key highlights: 

  • Net Profit: Rs 310.63 crore, up 50.17% year-on-year
  • Net Interest Income: Rs 1,850 crore, up 32% year-on-year
  • Gross NPA: Declined to 13.4%

Below are details from Yes Bank's quarterly results:

Yes Bank Q1 FY23 Earnings:  Profit beats estimates 

Yes Bank reported a net profit of Rs 310.63 crore in Q1FY23, up 50.17% from the year-ago period, beating street expectations. Analysts had earlier anticipated a profit of about Rs 275 crore. Sequentially, the profit was up from Rs 266 crore.

Yes Bank Q1 Results Net Interest Income Rises 

A bank’s main business is borrowing money from different sources and lending that money at a higher rate. The income the bank generates from this difference is known as net interest income. Net interest income for Yes Bank grew to Rs 1,850 crore, up 32% year-on-year (YoY). Net interest margin grew 30 bps on quarter to 2.4%.

Non-interest income (other income) for Q1FY23 stood at Rs 781 crore, down by 10.1% due to lower income from forex, debt capital markets, and securities segments.

Yes Bank Q1 Results: Asset quality improves 

The bank’s Gross NPA ratio stood at 13.4% compared with 15.6% in the April-June quarter, compared with 15.6% in Q1FY22 and 13.9% in Q4FY22. Net NPA ratio reduced 160 bps year on year to 4.2% and 30 bps sequentially.

Yes Bank Q1 Results: Provisions Fell 

Provisions for bad loans for the June quarter were at Rs 175 crore. It declined 62% year on year and 36% sequentially, aided by lower slippages that came in at Rs 1,072 crore against Rs 2,233 crore in the year-ago period. 

Yes Bank Q1 Results: Deposits Rise

 The Bank’s net advances at the end of the June quarter stood at Rs 1.86 lakh crore, a growth of around 3% on quarter and 14% year on year. The retail & corporate mix stood at 62% and 38%, respectively. The deposits increased by 18% year on year to Rs 1.93 lakh crore, with total balance sheet growth at 17% year on year.

Bank’s CASA (current and savings account) deposits now comprise 30.8% of total deposits of the bank compared to 27.4% in the Q1FY23. CASA capital is the cheapest source of capital for every bank. CASA continues to grow at nearly 2x the rate of overall deposits growth.

Yes Bank Q1 Results: Other Key highlights

 As per reports, nearly every third digital transaction that happens in India is powered by Yes Bank. Yes Bank signed a binding term sheet with JCF ARC LLC & JC Flowers Asset Reconstruction Company for a strategic partnership concerning the sale of identified stressed loans of the bank.

Yes Bank Q1 Results: Analysts' Review

ICICI Securities: The brokerage firm remains cognizant of risks arising from delay in resolution of the stress pool, modest RoE profile during the transition, and supply overhang post the expiry of lock-in shares. ICICI Securities maintained a HOLD rating on Yes Bank with a target price of Rs 14.7.

Nirmal Bang Institutional Equities: Though the loan mix improved and NIM continued to recover,  the brokerage has a SELL call on Yes Bank with a target price of Rs 13.4. It finds medium-term ROA targets unattractive given the investable opportunities available with larger banks.

  • How has Yes Bank performed in Q1FY23?

  • What is Yes Bank's PE ratio?

  • Does Yes Bank pay a dividend?

  • What is the target price of Yes Bank?

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