Yes Bank – Deviation

Yes Bank is an Indian private sector bank which is headquartered in Mumbai, India and was founded by Rana Kapoor and Ashok Kapoor in 2004. The Bank is engaged in providing banking services, including corporate and institutional banking, financial markets, investment banking, corporate finance, branch banking, business and transaction banking, and wealth management.

Quarterly Earnings Walkthrough

Yes Bank registered a sharp 80 percent year-on-year fall in its consolidated net profit to ₹52 crore in the third quarter of FY23 (Q3FY23) as compared to ₹266 crore in the previous year period.

Sequentially, this decline was 66 percent from ₹153 crore in the second quarter of the current fiscal year. The lender informed the stock exchanges that the net profit in Q3 FY23 was adversely impacted due to “ageing related provisions”.

The bank’s net interest income has risen by 12 percent to ₹1,971 crore in Q3FY23 from ₹1,764 crore in the previous year period. Its total net income was registered at ₹3,114 in Q3FY23, which is up by a good 24 percent YoY and 7 percent up QoQ.

The company has informed that it has witnessed a ‘sustained improvement’ in its non-performing asset ratios. The gross non-performing performing asset (GNPA) ratio stood at 2 percent in the December quarter, as against 15 percent in the year-ago period whereas the NNPA ratio came down to 1 percent, as compared to 5.3 percent in Q2 FY23.

The bank has achieved new sanctions and disbursements of ₹27,311 crore in Q3 FY23. Meanwhile, its balance sheet during the quarter under review has grown by 13 percent YoY to ₹3,43,798 crore.

The total deposits were calculated to be at ₹2,13,608 crore, which is a good growth of 16 percent YoY and net advances during the quarter stood at ₹1,94,573 crore which is up 10 percent YoY.

Short directional opportunity

Yes Bank shares are expected to be the target when the Indian stock market opens on Monday. The 3-year lock-in of State Bank of India (SBI) exposure in Yes Bank expires on 6th March 2023. Similarly, three years lock-in of shareholding of Axis Bank, ICICI Bank, IDFC First Bank, HDFC Bank, etc bank is also expiring in March 2023. The market is hoping for these banks to shed some load of the stake of Yes Bank.

Technical Analysis

Yes Bank Weekly Candlestick Chart on Sharekhan’s TradeTiger

Yes Bank stock price has made a full retracement to the 61.8% retracement level and the price receives crucial support at the Rs 16 mark. A gap filling is most likely to occur in the mid-term and the gap is marked on the chart in the yellow box. If the price breaks the 61.8% retracement level, the stock price may crash down to Rs 10. Short directional trades may be initiated with a stop loss trigger.

Disclaimer: We do not endorse or encourage you to take trades or investment decisions based upon our posts/research, all of your trading and investment activities are your own and should be taken through consultation with reputed financial advisors. The analysis posted on this website has been created by involving multiple mediums which are present over the Internet.

Leave a Reply