Yes Bank is gearing up to release its Q4FY25 results on April 19, and early estimates from brokerages suggest a strong year-on-year growth in profit, even as the bank grapples with margin pressures on its core income.
The bank’s net profit (PAT) is expected to rise between 35% to 44% as compared to the same quarter last year. This jump reflects improved operational performance and better asset quality. However, the optimism around profit growth is slightly balanced by headwinds in net interest income (NII) and margins, which continue to pose challenges.
š Growth with Caution: What the Estimates Say
Two leading brokerage firms, JM Financial and Anand Rathi, have shared their projections ahead of the Q4 results.
JM Financial expects PAT at ā¹608 crore, which marks a 34.6% YoY growth. But compared to the previous quarter, this reflects a marginal dip, suggesting pressures on the bottom line despite annual gains.
Yes Bankās NII is projected to rise just 2.6% YoY, reaching around ā¹2,209 crore. On a QoQ basis, this shows a slight decline of 0.6%, highlighting concerns around interest margins.
Net Interest Margins (NIMs) are expected to remain flat at 2.1%, indicating a lack of expansion in profitability from lending operations.
Another key metric, Pre-Provision Operating Profit (PPOP), is forecasted at ā¹1,040 crore ā a 15.2% rise YoY, but a 3.6% decline from the previous quarter.
Meanwhile, loan growth is estimated at 8.2%, showing consistent business momentum even amid economic headwinds.
š Anand Rathi Sees Stronger Momentum
On the other hand, Anand Rathi Share and Stock Brokers have a slightly more optimistic view. They project a PAT of ā¹652 crore, reflecting a robust 44.3% YoY increase and a 6.5% QoQ growth, pointing towards steady improvement across quarters.
ā ļø Margin Pressure Remains a Concern
Despite the promising profit growth, margin compression and modest loan expansion continue to worry analysts. JM Financial, in fact, maintains a āSellā rating on Yes Bank, citing valuation concerns and limited earnings upside in the near term.
ā Final Word
While Yes Bankās Q4FY25 earnings may showcase strong YoY profit growth, the muted trend in NII and NIMs signals an area that investors should keep an eye on. As the bank announces its results alongside giants like HDFC Bank and ICICI Bank, it will be interesting to see how it navigates the current interest rate environment and maintains profitability.
Stay tuned for the actual results on April 19.
