SBI & LIC-Backed Private Bank Announces Q1 FY25 Earnings; PAT Grows by 47 per cent; Moody’s Upgraded Rating Outlook to “Positive” from “Stable”
The company’s shares have delivered an impressive return of over 40 per cent in the past 1 year.
In a robust display of financial health and strategic execution, Yes Bank reported impressive figures for Q1FY25. The net profit surged to Rs 502 crores, marking a substantial year-on-year increase of 46.7 per cent and an 11.2 per cent rise quarter-on-quarter. This solid performance underscores the company's effective management and operational efficiency.
Key Financial Metrics:
Net Interest Margin (NIM): Maintained steady at 2.4 per cent compared to the previous quarter, reflecting consistent performance in core operations.
Non-Interest Income: Reached RS 1,199 crores, with a normalized growth of 20.5 per cent year-on-year, demonstrating strong performance in fee-based activities.
Net Provision Costs: Reduced significantly by 41.2 per cent year-on-year and 55.0 per cent quarter-on-quarter, indicating improved asset quality and risk management.
Asset Quality and Balance Sheet Strength:
Return on Assets (RoA): Improved to 0.5 per cent from 0.4 per cent in Q1FY24 and remained stable compared to Q4FY24.
Deposit Accretion: Robust growth of 20.8 per cent year-on-year highlights the company’s strong deposit-raising capabilities.
CASA Ratio: Remained stable at 30.8 per cent despite seasonal fluctuations in Q1.
Net Advances Growth: Increased by 14.7 per cent year-on-year, driven by sustained growth in SME (23.8 per cent year-on-year), Mid Corporate Advances (25.0 per cent year-on-year), and a resurgence in the corporate segment (13.8 per cent year-on-year).
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Asset Quality Improvements:
Gross Non-Performing Assets (GNPA): Reduced to 1.7 per cent.
Net Non-Performing Assets (NNPA): Lowered to 0.5 per cent, with a Provision Coverage Ratio (PCR) of 67.6 per cent, up 100 basis points from the previous quarter.
Resolution Momentum: Continued strong performance with recoveries/resolutions amounting to RS 1,581 crores in Q1FY25.
Strategic Moves and Upgrades:
Warrants Exercise: Both CA Basque Investments and Verventa Holding Ltd. exercised outstanding warrants, leading to a 100-basis points accretion to the CET I per cent ratio.
Rating Upgrades: Moody’s upgraded the rating outlook to “Positive” from “Stable” in July 2024. ICRA also upgraded the credit rating on the company’s instruments from A- to A, reflecting enhanced financial stability and growth prospects.
Overall, the company has demonstrated impressive financial performance and strategic execution, with significant improvements in profitability, asset quality, and balance sheet strength. These developments position the company well for sustained growth and operational success in the upcoming quarters.
On Friday the share of Yes Bank closed at Rs 24.78 per share on the BSE.
Investors must keep this Mid-Cap stock on their radar.
Disclaimer: The article is for informational purposes only and not investment advice.