Yes Bank is showing continued stress in its book with new loan stress at 17% as per brokerage firm Elara Capital. Also outstanding stress stands at 39 percent.
On the operations front, while profitability saw a surge quarter on quarter by 16 percent, on a yearly basis there has been seen a decline of 101% in net profit in the review period ending December 2020.
Also asset quality continued to show stress with sharp deterioration in the review period.
Stress from new loans that included standstill NPL, SMA1, SMA2 together with restructured loans were high at Rs. 282 billion or 17 percent of total loans in the December ended quarter as against just 5% in Q2 period of the ongoing fiscal year. Reported GNPLs of Yes Bank stood at 15% vs 17% QoQ. Total outstanding stress loans rose sharply to 39% from 29% QoQ with proforma GNPLs rising from 18% to 20% and standard stress loans rising from 11% to 19%.
Growth seen in deposit on a QoQ basis
There was seen growth in both deposits and CASA on a QoQ basis but there was decline on a yearly basis at 12% and 29%, respectively. Disbursal of loans to the MSME and retail segment topped Rs. 120 billion as against the targeted levels of Rs. 100 billion. Also, credit cost saw a surge on increasing stress in the bank's assets portfolio.
Elara Capital Recommends Sell Rating On Yes Bank
On continuing stress in its loan book and as there continues to be a spike in its asset portfolio as was seen by the brokerage for the H2Fy21, the brokerage has given a Sell call on the counter with a target price of Rs. 6 per share. Last, the scrip closed at a price of Rs. 16.05 per share on the NSE. In the December ended quarter, mutual funds have also reduced their shareholding in the counter.