Yes bank


Yes Bank’s problems have just started. The leadership issue will take longer to resolve given his relationships with other promoter group. It is funny that he plans to take legal action against RBI. His smugness has no end if he really wanted to do this. Two major private banks ICICI and Yes have appointed ex-Fin min officials as Chairman. Sadly, YB’s chairman will himself chargesheeted in Aircel Maxis case. What kind of message he wanted to give? He could not find any banking veteran as Chairman? There were enough signals for the upcoming fiasco. I just hope RK himself doesn’t spend his retirement in litigations.

YB shares will not recover fully unless mr RK is removed from the board too as it will result in either remote control or twin power centres and RBI won’t sit idle in either scenario.

(test) #575

While yes banks leadership problems may have just started, the fall in stock price by 45 pct has been in anticipation of these problems. So a lot seems to be in the price. It’s a fair point whether or not incumbent ceo should continue to be on the board or not

(dprashant) #576

Super , very few people can do that by overcoming their bias …both edelweiss and yes bank are my top 2 and top 3 holding and sooner we investigat and acknowledge our mistake better it is for us.
I am still holding both as of now but I don’t see anything wrong with edelweiss as far as long term fundamental goes but I am not too sure about Yes bank so analysing what to do .
Wish to remain free of biases just because I own it …
Kindly keep sharing your views

(AKGupta) #578

For any bank, it’s the strength of pre provision profits which matters the most. Yes Bank has had strong 25%+ CAGR from 3K to 7.7K crore in Pre provision profits in last 4 years and expected to continue having the same.

As for the elephant in the room, the looming NPAs and their underreporting. I expect Yes to have some quarters of extraordinary provisions to cover for these NPAs and comply with RBIs definition. This will mean erosion of capital as well in order to shore up which it’ll need to raise fresh capital from marquee investors.
The sooner it raises capital the better and the price at which that capital is raised will also affect the stock price.
In order to raise enough fresh capital, RK perhaps will need to send some strong signal to the market by maybe selecting a capable CEO well versed in the business of which I’m sure there is no dearth of both inside and outside the bank.
That CEO will have his hands full in the sense that he’ll need to convince investors for raising capital and start showing some tough love towards the stressed assets by making enough provisions for them ultimately preserving the BVPS.
Quantum of capital requirement will depend on the NPA figure declared by RBI in its audit.


For me YB becomes a great buy as soon as RK is out from the board and the mgmt team. I won’t look at price levels at that time except that it has to be below 2x P/B for me to buy. It will signal significant easing of uncertainty and probably a new beginning.

(dprashant) #580

(vaibhav) #581

Divergence for 2016 was ~4000cr
For 2017, after 50% growth was ~6000cr
For 2018, assuming another 50% growth, let’s say it’s 9000cr.
On this 9000cr if they have a 60% pcr, provisioning requirement becomes 5400cr. Let’s say that they would have taken 1700cr provisions/write-offs on these assets even without qualifying these as NPAs. So additionally they would have to take (5400-1700=)3700cr provisions, which is about PBT (profits before tax) of 2 quarters.

Note that above is pure guess-work.

(jainnitinp) #582

Does anyone on the forum have or is able to find out data regarding institutional buying/selling that may have happened yesterday? I did my own digging but the sources didn’t seem too reliable.

(venkat457) #584

Can we consider that UBS might have insider info or strong sense about denial of RK extension and seriousness of issues at YB ? When they given 170 as Target price most of the ppl thought it’s might be biased due to their fight with YB but now it’s seems that’s going to be possible.

Disc: Invested recently and looking forward to add more in view of 2-3 yrs term.

(dprashant) #585

I get bulk deal anx insider buy/sell info .
Is that what you looking for ? Please let me know so can post it

(jainnitinp) #586

Yes, please. thanks! But yesterday’s info would be very crucial.

(dprashant) #589

bulk and insider from NSE 21st Sept.xlsx (16.4 KB)

here is the XLS with the info , I just realized that there were some formatting related issues in my earlier posts.

(AtulD) #590

ICRA has reaffirmed the ratings on various borrowing programme of Yes Bank Limited (YBL); the outlook on long term ratings has been revised to stable from positive. ICRA hasreaffirmed rating of [ICRA]AA+ (pronounced ICRA double A plus) for the Rs. 2,530.60 crore Basel II compliant lower tier II bonds and the Rs. 7,030 crore infrastructure bonds and the ratingof [ICRA]AA (pronounced ICRA double A) for the Rs. 1,544.10 crore Basel II compliant upper tier II bonds and Rs. 461 crore Basel II complaint innovative perpetual tier I debt Instruments of the bank. In addition, ICRA also has reaffirmed the ratingof [ICRA]AA+ (hyb) (pronounced as ICRA double A plus hybrid) for the Rs. 10,900 crore Basel III Compliant Tier II Bonds and the rating of [ICRA]AA (hyb) (pronounced as ICRA double A hybrid) for the Rs. 10,800 crore Basel III compliant additional tier I bonds. ICRA also has reaffirmed rating of [ICRA]A1+ (pronounced ICRA A one plus) for the Rs. 20,000 crore certificate of deposit programme and the short term fixed deposits of the bank.

ICRA report, 21st Sept 2018.

(jainnitinp) #591

thanks a lot for the info. There isn’t any buy/sell data, however, on YB. Does that mean there was no institutional purchase/sale in it yesterday?
I can understand the lack of a purchase. People would want to wait for the price to stabilize and also for the outcome of the upcoming board meeting before they take a call on whether to purchase or not. However, the lack of a sale by institutions yet could be a little heartening.

(AtulD) #592

No data is available on NSE and BSE. But how moneycontrol is showing the details of block deal?

(dprashant) #593

It’s only bulk deal and insider buy/sell data from NSE …not sure if My one was sold it on BSE ,or in open market etc.

(Mikesingh) #594

Reading the replies in this thread, I remember an old teaching by an old investor long back.
He told when your own work is not good, every uncertainity you face in the market, you will look for a justifiable excuses.
Problem with yes bank holders is they have done no study of the bank accounts for last 10 years.
Now blaming on RBI, RK exit and all.
Exits come and goes, businesses stays. Study what the business is worth. Its hard earned money be very sure where one is putting.


(cool_gaurav) #595
Yes Bank Delivery Details (NSE) Quantity Traded 29,35,52,756
Deliverable Quantity (gross across client level) 11,57,40,552
% of Deliverable Quantity to Traded Quantity 39.43 %

Surprisingly , no funds name appearing in block/bulk deal…As per latest shareholding pattern around 20.50 crore shares with retail investors and total delivery 11 crore shares. Is retail shareholders sold in panic??

([email protected]) #596

Yesterday was to be the board meeting. Does any investor friend has an update on that?

What all weak governance and weak compliance encompass will have to be seen. It looks pretty certain that stock price will see some more downside. Will it go down to levels of Rs 170?

Read about a recommendation after the fall on 21st with an upside of 65 - 70% by FY 21.

Disc: Invested, added few on 21st.

(Manojlion) #597

I have few very basic questions people

How does calculate the NPA of various banks .

In Yes bank’s case,the RBI has reported a divergence in NPA for 2016 and 2017, however has the Yes bank changed their NPA or provisions? Does that mean that Yes bank is contesting with the NPA numbers reported by RBI?

Is there a transparency in the NPA numbers reported by RBI for Yes bank or other banks?

If RBI comes up with NPA divergence for HDFC bank ,may be after two years,who we all agree is the most transparent and loyal bank(take this with few spoons of salt) …should we believe that HDFC is also reporting incorrect numbers?

As long as the transparency of RBI is not clear , I believe retail investors are only playing a 'guessing game ’ and our ‘ownership bias’ plays enough role to hold the Yes bank

I have not thoroughly analysed if the performance of Yes bank has deteriorated after this ‘NPA divergence’ issue came into light last year . I know that the Market cap has surely come down,how about the other operating factors?.Can any of the seniors look into this?

I am a very newbie retail investor struggling to understand the honesty of reported numbers in various scripts.