YESBANK - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 3.5

📊 Core Financials Overview

Profitability

ROE: 5.38% and ROCE: 6.34% — modest, signaling limited capital efficiency compared to top-tier banks.

EPS: ₹0.86, with PAT rising from ₹738 Cr. to ₹801 Cr. — a solid 59.4% quarterly growth, indicating improving earnings trajectory.

Debt-to-equity: 7.04 — extremely high, typical for banks but still a concern given YES Bank’s legacy issues.

Dividend Yield: 0.00% — no payouts, reflecting capital preservation or reinvestment focus.

Institutional Sentiment

FII holding declined (-1.93%), while DII increased (+0.74%) — mixed signals, with domestic investors showing cautious optimism.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 24.4 Above industry average (12.6) — mildly overvalued.

P/B Ratio ~1.36 Reasonable, slightly above book value.

PEG Ratio 0.79 Attractive — valuation aligns with earnings growth.

Intrinsic Value ~₹19–₹20 (est.) Current price of ₹21.1 is slightly above fair value.

🧠 Business Model & Competitive Edge

Core Operations: YES Bank provides retail, MSME, wholesale, and rural banking services, with a pan-India presence and international offices.

Strengths

Improving asset quality and profitability.

Strategic backing from SBI and other institutions post-restructuring.

Strong digital infrastructure and diversified product suite.

Challenges

Legacy governance issues and high leverage.

ROE and ROCE remain below industry leaders.

FII outflows and elevated RSI (67.5) suggest caution.

📈 Entry Zone & Technicals

DMA 50: ₹19.9, DMA 200: ₹19.8 — price is above both, indicating short-term strength.

RSI: 67.5 — approaching overbought territory.

MACD: 0.47 — mild bullish momentum.

📌 Entry Zone: ₹18.5–₹20.0 — suitable for accumulation on dips.

🕰️ Long-Term Holding Guidance

2025 Target: ₹15–₹25

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2026 Target: ₹18–₹30

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2030 Target: ₹50–₹90

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Holding Strategy: YES Bank is a speculative turnaround story with improving fundamentals and institutional support. Suitable for high-risk investors with a long-term horizon. Accumulate cautiously and monitor asset quality, governance, and capital adequacy.

For deeper insights, explore the YES Bank share price forecast and analysis

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