Yes bank shares fall 4% after Q2 results: here's why

Shares of private lender Yes Bank declined as much as 4% to hit an intraday low of ₹16.56, despite the company reporting a 47.4% year-on-year increase in consolidated net profit to ₹225.21 crore in the July to September quarter of FY24, as against ₹152.82 crore in the same period last year. Sequentially, the company’s  profit declined by 34.3% as against ₹343 crore in the June quarter of FY24.

Post Q2 results, the share price of the private sector lender opened higher at ₹17.42, as against the previous closing price of ₹17.28 on the BSE. The stock, however, soon witnessed selling pressure due to decline in net interest income, according to analysts. At the time of reporting, the share price of the company was trading 2.95% lower at ₹16.77. This is in line with the broader BSE Sensex, which was trading 0.28% lower at ₹175.11.

At present, the share price of the company is trading 32.04% lower than the 52-week high of ₹24.75, which the company touched on December 14 this year. The share price of the company is trading at 16.8% higher than the 52-week low of ₹14.40, which the company touched on March 13, this year. During the session, the company's market capitalisation stood at ₹48,370.98, with more than 2.77 crore shares exchanging hands on the BSE as against the two-week average of 241.88 shares.

In the September quarter, the company’s net interest income declined by 3.3% year-on-year to ₹1,925 crore, as against ₹1,991 crore in the same period last year. Sequentially, the company's net interest income declined by 3.7%, against ₹2,000 crore in the June quarter.

During the quarter under review, the company’s total net income stood at ₹3,135 crore, up 9.4%, as against ₹2,866 crore. Sequentially, the private sector lenders' total net income declined by 0.2%, as against ₹3,141 crore in the June quarter.

“The Bank's Q2 FY24 performance is a testament to the strength of the core franchise that the Bank has built through significant strategic interventions during the last three years. Amidst a challenging environment with respect to interest rates, deposit growth slowdown, as well as tightening liquidity, the Bank has managed to deliver Y[1]o-Y expansion in both operating profitability and net profitability. At the same time, the fortification of Balance Sheet from Asset Quality standpoint continues, supported by robust redemptions from the Security Receipts,” says Prashant Kumar, MD & CEO, Yes Bank.

In the September quarter, the company’s gross non-performing asset ratio stood at 2% as against 12.9% in the same period last year. The company’s net non-performing asset (NNPA) ratio stood at 0.9% during the quarter under review, as against 3.6% in the same period last year.  

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