Yes Bank share: Is this a stock to buy after Q3 update? EXPLAINED | Stock Market News
Source: Live Mint
Yes Bank shares: After the announcement of Yes Bank’s Q3 update for the current financial year, Yes Bank’s share price witnessed strong buying during Friday deals and continues to remain under the bulls’ lens. According to stock market experts, Yes Bank shares went up after a substantial Q3 update in which the private lender reported a robust 14.6% YoY increase in deposits and a 12.60 per cent YoY rise in loans and advances. This triggered buying in Yes Bank shares as the market is expecting strong Yes Bank Q3 results in 2024-25. They said that buying Yes Bank shares may continue, and the stock may touch ₹22 soon.
Yes Bank Q3 update in focus
Speaking on the impact of Yes Bank’s Q3 update for the current financial year, Anshul Jain, Head of Research at Lakshmishree Investment and Securities, said, “Yes Bank reported a robust 14.6 per cent YoY increase in deposits, reaching ₹2.77 lakh crore in Q3FY25, up from ₹2.41 lakh crore in the corresponding period in FY24, though QoQ growth remained flat. Loans and advances grew 12.6 per cent YoY to ₹2.45 lakh crore, with a 4.2 per cent sequential uptick. CASA deposits surged by an impressive 27.6 per cent YoY to ₹91,575 crore, marking a 3.4 per cent QoQ rise.”
Pointing towards the improvement in the cost of funding of Yes Bank, Abhishek Pandya, Research Analyst, StoxBox, said, “The CASA ratio improved to 33 per cent as of December 31, 2024, up from 32 per cent in the previous quarter and 29.7 per cent a year ago. The credit-deposit (CD) ratio stood at 88.4 per cent as of December 31, 2024, an increase from 84.8 per cent on September 30, 2024, but slightly lower than the 89.9 per cent recorded a year earlier. Additionally, the liquidity coverage ratio (LCR) was 133.2 per cent, up from 132 per cent in the second quarter of FY25 and 118.4 per cent in the third quarter of FY25.”
“However, deposits have increased more than advances, suggesting that the bank is taking precautions moving forward due to the stress observed in the microfinance institution (MFI) and unsecured lending segments within the overall banking sector. Yes Bank’s deposits were flat on a QoQ basis. Further, we might see some pressure on NIM due to a shortfall in PSL compliance, which is currently parked in low-yielding investments (RIDF) and is likely to continue in the medium term. Hence, as we move forward, we will closely monitor the asset quality ratios, profitability, and management commentary on the upcoming results,” the StoxBox expert said.
Yes Bank share price target
Asked about the outlook of Yes Bank shares after the Q3 update, Sugandha Sachdeva, Founder of SS WealthStreet, said, “Yes Bank share price has formed a short-term base around the Rs.19-18.80 zone on monthly charts. As long as this level holds, there is potential for a recovery in the stock. In the near term, YES Bank shares could target ₹21.20 to ₹22, while a sustained momentum above ₹22 level could pave the way for a rally toward the ₹24 mark. Even as the stock is trading below key moving averages daily and weekly, forming a base and improving fundamentals could result in a bounce back.
Unveiling the investment strategy in Yes Bank shares, Sugandha Sachdeva said, “Investors should, however, maintain a strict stop-loss on a closing basis while monitoring the overall market direction and any news developments related to the bank, which shall also play a crucial role in determining the stock’s trajectory.”
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
