Yes Bank Q4 Result Preview: Strong PAT growth likely even as NII may fall 3% YoY

All three brokerages see Yes Bank's Net Interest Income (NII) to degrow over Q4FY23. Nomura estimates NII at Rs 2,080 crore for Q4FY24, down by 1% while Anand Rathi and JM see it declining by 3.8% and 3%, respectively on a YoY basis. NII is expected to be around Rs 2,050 crore in the January-March period which will be down by 2.6% as per the average estimates by these three brokerages.

In its preview note, Nonura had estimated large private banks to witness continuation in normalisation in their returns on assets (Q4FY24 RoAs) amid moderation of net interest margins (NIMs) which had peaked out in 4QFY23.

Yes Bank will announce its quarterly earnings on Saturday, April 27.

Here's what they recommend.

Nomura

Japanese brokerage Nomura sees Yes Bank's NII declining by 1% on a YoY basis to Rs 2,080 crore while a 3% uptick is seen on the QoQ basis. The lender is expected to report a PAT of Rs 280 crore which will be a 37% YoY jump and 20% on a sequential basis.

Nomura also sees net interest margins (NIMs) to go down by 40 bps on a YoY basis to 2.4% as against 2.8% reported by it in Q4FY23. It will likely remain flat over the October-December quarter.

The pre-provision operating profit (PPoP) for the reporting quarter is expected to be at Rs 910 crore which will be a 2% YoY uptick while 5% on QoQ basis.

The brokerage also estimates returns on assets (RoA) at 0.3% which will be an up move of 5 bps over the corresponding quarter of the last financial year and 3 bps on a sequential basis.

Loans are expected to rise 12% YoY to Rs 2,28,500 crore in Q4FY24 versus Rs 2,03,300 crore in Q4FY23. Sequentially a 5% growth is foreseen. As for deposits, a 22% YoY growth will likely be posted by the bank at Rs 2,66,400 crore versus 2,17,500 crore in Q4FY23. On the QoQ basis, it will be 10%.

The credit cost is expected to decline to 1% in Q4FY24 versus 1.3% in Q4FY23 and 0.9% in Q3FY24.

Anand Rathi

Anand Rathi sees NII for the reported quarter at Rs 2,025.6 crore which will be down by 3.8% on the YoY basis while marginally up at 0.4% on the QoQ basis. The pre-provision operating profit (PPoP) for the quarter ended March 31, 2024 is likely to stand at Rs 895.90 higher by 0.8% on YoY basis and 3.7% on a QoQ basis.

The profit after tax (PAT) is seen at Rs 252 crore, which is expected to go up by 24.5% on the YoY basis and 8.9% on the QoQ basis.

JM Financial

The PAT is expected to go up by 111.1% to Rs 427.20 crore in Q4FY24 while an 84.6% sequential rise is seen. JM sees Yes Bank's fourth quarter NII to degrow by 3% on the YoY basis to Rs 2,042.10 crore while rising by 1.3% over the previous quarter ended December 31, 2023. At Rs 689 crore, PPoP for the quarter gone is expected to decline by 22.5% over the corresponding quarter of the last financial year. The QoQ decline is estimated at 20.3%.

The loans disbursed by the bank during the said quarter is expected to hit 2,28,465 crore mark, jumping 12.4% YoY and 5% QoQ. Deposits for Q4FY24 are likely to be reported at Rs 2,66,364 crore which is an uptick of 22.5% YoY and 10.1% QoQ.

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