Shares of YES Bank remain under pressure despite analysts raising their target prices after the June 2024 quarter results. Brokerages such as Emkay Global Financial Services, Kotak Institutional Equities, and ICICI Securities have increased price targets but continue to maintain a ‘sell’ rating, citing weak growth and expensive valuations.
YES Bank reported a 59% year-on-year (YoY) jump in net profit to ₹801 crore in the June 2025 quarter, compared to ₹502 crore last year. Net interest income (NII) grew 5.7% YoY to ₹2,371 crore, while non-interest income rose sharply by 46% to ₹1,752 crore. Despite the earnings growth, the bank’s credit growth slowed to 5%, and net interest margin (NIM) stayed flat at 2.5%.
Analysts’ Views
Emkay Global noted that YES Bank’s better earnings were driven by treasury gains but expects NIM to decline in the next quarter due to lending rate cuts. The retail loan portfolio continues to face stress with a slippage ratio of 2.5%. Emkay raised its FY26 earnings estimate by 5% and revised its target price to ₹17 from ₹16 but kept its ‘sell’ rating due to weak growth and return ratios.
Kotak Institutional Equities also increased its fair value to ₹18 from ₹17, citing gradual improvement in return on equity (RoE) but still finding valuations expensive. ICICI Securities, with the highest target of ₹20, highlighted that YES Bank’s operating metrics are improving but RoA remains low at 0.7%.
Key Financial Metrics
Provisions increased by 34% YoY to ₹284 crore but fell sequentially, while the gross NPA ratio stayed flat at 1.60% and net NPA at 0.30%. After warrant conversion, CET-1 capital stands at 13.3%. YES Bank’s shares closed at ₹20.16, down slightly, and remain 26% below the 52-week high of ₹27.20 recorded in July 2024.
Analysts believe the bank is making efforts to boost profitability through better PSL origination and lower credit costs. However, they caution that the turnaround will take time, and the current valuation of 1.5 times FY26 estimated book value fully reflects the bank’s potential recovery.
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