YES Bank - stock tip

IDBI Capital maintains ‘buy’ rating on YES Bank

CMP: Rs 138.35 ( 8th Aug 08 )
Target Price: na
IDBI Capital has maintained a ‘buy’ rating on YES Bank, on expectations of higher growth happen. The brokerage expects the Bank to log strong income growth in the long term. Despite mark-to-market (MTM) depreciation, net provisions have been lower owing to reversals equivalent to MTM depreciation done on investment provisions, the IDBI report noted. The bank has increased its lending and deposit rates recently. The PLR has been raised by 150 bps to 17% while the card rates for deposits have undergone changes in various maturities from 50-75 bps. “We expect the PLR change to immediately have a beneficial impact on the bank’s earnings while the full impact of deposit rate hike should be expected in FY10,” the report said. IDBI has revised net profits for FY09 and FY10 to Rs 2,927 million and Rs 4,394 million, respectively.