This expert give Yes Bank price target of Rs 20.4 and pegs BREAKOUT at above Rs 16.5

Yes Bank share price today is Rs 15.55 and it is trading flat. The lender has been constantly in the news and its share price has been attracting a lot of attention. Ashis Biswas, Head of Technical Research at CapitalVia Global Research says that technically, Yes Bank is trading in a small band that resembles a wedge price pattern. In the declining wedge, it is now nearing its upper band. In short to medium term, Ashish believes a breakout over the Rs 16.50 mark is critical. Under that scenario, Ashis anticipated the stock to move towards Rs 20.40, but investors must ensure they follow the stop-loss, which he pegged at Rs 13.7

Ashish says Yes Bank had a stronger operational performance than forecast due to a higher NIM, higher non-interest revenues, and better cost management. Total stress at the bank is Rs. 385.8 bn (net of total provisions), or 23% of total advances and 104 % of current equity reserves. The SMA 1+2 book increased 181 % year on year to Rs. 188.5 billion, accounting for 11.1 % of overall advances, up from 4% in 2QFY21.

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Ashis said that Yes Bank management stated that its current capital level is ample to follow growth for another 2-3 years. NII grew the cash flows by 1.4 times year on year and by 29.7% quarter over quarter. The Non-interest profits of Yes Bank increased by 91.4 % yoy and 69.4 % qoq (Rs 5.4 bn).

Yes Bank ever-increasing stress book:

Anand Rathi says that Yes Bank disclosed an overall stress book of Rs 185.5 bn (10.9% of loans), of which Rs 83 bn are standstill accounts. The potential Yes Bank stress book is up 106% from what the bank disclosed in the last quarter. Besides the Rs 185 bn book, Rs 123 bn is outstanding as SMA-1.

Anand Rathi says that although most of the Yes Bank stress stemmed from the corporate book, increases in SME and the retail book are concerns. Given these fresh disclosures, Yes Bank slippages are expected to be higher than what management had talked about earlier.