YES Bank shares rise ahead of Q3 results; check analyst expectations & target price

Shares of YES Bank Ltd nudged slightly higher on Thursday ahead of the private lender's results for the December 2023 quarter . The private sector lender will announce its earnings for the quarter and nine-months ended on December 31, 2023 on Saturday, which is a market holiday.

Subsequent to its results, the bank will host a conference call with analysts and investors on Monday, January 29, 2024 at 8.00 AM IST to discuss the financial results with the participants, it said in a separate exchange filing with the bourses.

Shares of YES Bank rose more than 2.4 per cent on Thursday, commanding a total market market capitalization of around Rs 71,500 crore. The private lender settled at Rs 24.68 in the previous trading session. The scrip had tested its 52-week high levels of Rs 26.25 on January 16, 2024, rising over 85 per cent in just three months.

Ahead of its earnings on Saturday, brokerage expects YES Bank to report a strong performance in the December 2023 quarter, with net profit zooming manifold, with net interest income (NIIs) and net interest margins (NIMs) seeing a decent growth. The bank's focus has shifted towards rebuilding the business and the management commentary would be key.

We expect YES Bank to come out with a healthy set of numbers in Q3FY24 as the bank’s asset quality is expected to remain stable due to the improvement seen in the recoveries in the past few quarters. This can be further confirmed by the SMA book remaining flattish sequentially, said Shreyansh V Shah, Research Analyst at StoxBox.

"The traction in retail and MSME indicates that the bank is gradually picking up pace in strengthening its retail franchise. Also, traction on disbursements in retail and MSME segments was quite healthy in its Q3FY24 business updates. With ARCs submitting bids for its two NPA loan books, we believe the bank will have healthy bottom-line growth in Q3FY24," he said.

We expect NII to grow 6 per cent YoY reflecting the underlying business growth. Business momentum is gaining traction across retail and MSME segments but overall loan growth to be lower than industry average. Deposit growth at 11 per cent YoY is meeting the business requirements but has significantly decelerated in recent quarters, said Kotak Institutional Equities.

"We should see healthy traction on recovery and upgrades in 4QFY23,mostly reflected in changes to the value of security receipts. Earnings impact is difficult to forecast given the nature of provisioning policy. Focus is shifting towards rebuilding the business for the bank. Conversations would be on growth and return to normalised levels of business operations," it added.

Technical analysts suggest investors hold the stock for further upside. However, the stock is witnessing some consolidation before the next leg of the rally kicks off. However, one needs to respect the stop losses carefully, they caution.

YES Bank has picked up quite well in the last three-months from Rs 16 zone and has maintained an uptrend with series of higher low formation on the daily chart with currently consolidating having the near-term support at Rs 23.70 levels, said Shiju Koothupalakkal, Technical Research Analyst, Prabhudas Lilladher.

"On the upside a decisive breach above Rs 25.70 – 26 zone is much needed to confirm a breakout and thereafter can anticipate further rise with next targets of Rs 28.50 and Rs 31 levels visible," he said.

"We have seen a fresh breakout in YES Bank around Rs 23," said Ganesh Dongre, Senior Manager - Technical Research, Anand Rathi Shares and Stock Brokers. "The stock continues to rally from Rs 19 till Rs 23. "The stock has again seen a bullish candlestick pattern formation at 23 price level, which may continue till Rs 26 and traders can hold the stock with a stop loss of Rs 19.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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