https://www.yesbank.in/pdf/annualreport_2017_18_pdf
Annual Report 17-18
Any Reason why ROE is on a continuous decline path?
In FY13 and FY14 Yes bank was leveraged and could not raise equity due to market conditions. FY15 onward, they raised funds and leverage came down. So did the ROE.
For a bank ROE is not very important. ROE is nothing but ROA * leverage. Your ROA should be good. Above 1.5 in Indian context is good. ROE of 16-18% over long term is fine.
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Out of Total 4819 Cr divergence NPA reported by RBI in yes Bank books for March 2017 in Oct 2017… As per Yes Bank , 485 Cr is classifies as NPA as on 31-3 2018 , all balance are either received back as payments or upgraded as standard account and 8% is sold to ARC…
485 Cr is left out of total 6355 cr ( Yes declared 1072 + RBI 5891, Net divergence 4891)
@Yogesh_s Proxy advisory firm SES has raised concerns that Yes Bank is going to dilute way too much 8% equity in the latest efforts to raise capital.
In my understanding, Yes Bank has diluted equity in the past as well to feed its massive growth engine. So the latest round is no big deal.
Please share your thoughts.
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What is a proxy advisory firm?
Too strong words, imho. BTW, Nirmal Bang Securities was bullish on Yes Bank a few years earlier. " I think it’s a good stock in the banking space - Nirmal Bang Securities" . I believe the writer you quoted was head of Equity Research at Nirmal Bang at that time.
Before quoting/believing an analyst, fund manager or expert, one may look deeply at the past track record. Views on HDFC bank on the related website’s home page are very interesting.
Company has redeemed the following bonds on exercise of call option after receiving approval from RBI. How should this move be viewed in the interest of the stock?
Kudos to RBI for demonstrating stringency in auditing and policing various banks including Yes Bank. A normal investor would find it difficult to understand bank’s book (if the auditor struggle to understand the book, where the individual investor stands). I am sure current Yes Bank’s auditor will be in the frame for huge divergence reported by Yes Bank.
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YES BANK receives SEBI approval to launch Mutual Fund business
YES BANK
-
Upgraded to Highest Care AAA Rating from Care AA +for Infrastructure Bonds and Tier II
Bonds (Basel III) -
Upgraded to Care AA + Rating from Care AA for Perpetual and Additional Tier I Bonds
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Hi
Not a surprising event. I think YBL has tried to control coverage earlier too.
Regards
Deepak
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The heading of the news article makes it look as if Yes Bank is a total villain here. But that may not be the case:
- UBS publishes a report on Yes Bank with certain factual inaccuracies
- Yes Bank writes to UBS asking them to fix the errors
- UBS fixes them but only partially
Yes Bank decides to complain against UBS.
While Yes Bank should not have contacted UBS directly, UBS should also have taken care to not publish factually incorrect numbers.
Also as per the article, “UBS analysts persistently put out negative reports on the bank and such reports were allegedly timed for issuance around certain market/ corporate events in a way that caused the maximum damage to Yes Bank.”
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I have full confidence in the leadership of YES bank. Incidentally, to best of my knowledge, they are the only one in the country producing Knowledge reports on a large number of sectors. The reports are of a top quality. That shows the professional competencies of the team. Many reports are available on their website.
Disc : invested since long and adding at all declines.
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After Yes Bank’s complaint, if UBS had not made any change to their report, that would have been credible. But the fact that UBS did so puts a question mark on their credibility. Who’s to say the numbers in the report are still not wrong? In any case, BSE has asked for a clarification from Yes Bank based on the article.
https://www.bseindia.com/corporates/anndet_new.aspx?newsid=f9f92603-a3ca-4fe5-b180-12a53ccd34ed
A brief analysis of promoter holding over the last 8 quarters. Sticking to percentages and not absolute numbers because there was a stock split last year. Although, the percentages for each of the promoters have reduced, none of them have sold a single share in this time period (even after adjusting for the split). However, their overall shareholding in the company has diluted. In my opinion, this is possibly due to the ESOP program. If anyone has anything more to add, please feel free.
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It is very churlish of yes bank management to ask UBS to drop coverage. Does UBS ask yes bank to stop lending to xyz sector ? Research companies will ultimately be judged by their clients / investors on the accuracy of their calls. The market has proved UBS to be wrong in the case of their recommendation on yes bank for years now. YB should realise that there is no point in wrestling with pigs, and should focus their energy on the business / investor relations etc.
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Please understand the there were “factual inaccuracies” in the UBS report and they DID partially correct them after Yes Bank sent them an email.
It is not just a matter of one call going right or wrong. It is not just a matter of getting incorrect future prospects and price targets. In this case audited past data was taken incorrectly!
Equities is a business where such inaccuracies can cause great loss to share holder value! Someone might just short the shares (or sell their investments) resulting in losses … all because of incorrect numbers from an analyst.
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