Yes Bank shares were down 4 percent after the bank’s fourth quarter net profit fell 45 percent year-on-year. The stock was quoting at Rs 15.55 at 10:51 AM on April 24.
Morgan Stanley is ‘underweight’ on the stock and cut price target to Rs 17.5, because topline growth was weak even as core pre-provision operating profit (PPoP) grew more than 20 percent year-on-year. The bank's Q4 profit after tax (PAT) was lower than expected due to lower-than-anticipated net interest income (NII) and fees, though this was partly offset by lower provisions. However, the bank's balance sheets showed improvement with higher coverage and capital ratios, the Morgan Stanley note said.
On April 22, Yes Bank Ltd reported a 45 percent decrease in standalone net profit to Rs 202 crore, for the quarter ending on March 31, 2023, as a result of increased provisions for bad loans. In comparison, the bank reported a standalone net profit of Rs 367 crore in the same period of the previous year.
Stock Performance
The Yes bank stock has lost 27.94 percent of its value since the start of this year. Thus, significantly underperforming the benchmark Nifty Bank index which has mostly remained flat since the start of this year and has lost 1.94 percent of its value.
It is also to be noted that on a 5-year basis, the nifty bank benchmark index has given a reasonable return of 66.79 percent whereas the Yes bank stock has lost 95.51 percent of its value during the same duration.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.