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Synopsis: Ventura Securities has issued a bullish outlook on Yes Bank Ltd, assigning a āBuyā rating with a target price of ā¹32.1, implying an upside of over 42% from current levels. The brokerage believes Yes Bank has moved beyond its turnaround phase and is now entering an early-stage growth cycle, supported by balance-sheet stabilisation, improving profitability, stronger governance, and a retail-led credit expansion. While the stock saw marginal weakness in the latest session, analysts view the correction as non-structural.
Yes Bankās journey over the past five years has been one of the most closely watched transformations in Indiaās banking sector. From a severe financial crisis to balance-sheet repair and now a gradual return to growth, the bankās trajectory is increasingly drawing the attention of long-term investors and brokerages alike.
The Great Shift: From Crisis Management to Growth Visibility
Ventura Securitiesā positive stance is rooted in its assessment that Yes Bankās problems were never about growth ambition itself, but about risk concentration and aggressive corporate lending. The brokerage notes that unchecked exposure to large corporate borrowers amplified stress, eventually leading to the financial crisis of FY20.
Following the crisis, Yes Bank undertook deep structural changesāreshaping its loan book, tightening underwriting standards, and realigning its strategy towards granular retail and commercial lending. These changes, according to Ventura, have fundamentally altered the bankās risk profile.
Balance Sheet Repair: The SBI Backstop Changed the Narrative
The turning point came with capital support from State Bank of India, which stabilised operations and restored depositor confidence. This intervention, combined with tighter governance and regulatory oversight, laid the foundation for recovery.
The numbers reflect this shift:
| Metric | FY20 | FY25 |
|---|---|---|
| Advances (ā¹ Cr) | 1,71,443 | 2,46,189 |
| Deposits (ā¹ Cr) | 1,05,364 | 2,84,525 |
Ventura highlights that the strategic stake by Japanās SMBC has further enhanced Yes Bankās global credibility and governance standards, reinforcing confidence among institutional stakeholders.
Loan Growth Outlook: Retail and Commercial to Dominate
Looking ahead, Ventura Securities expects Yes Bankās total loan book to grow from ā¹2.46 lakh crore in FY25 to ā¹3.38 lakh crore by FY28, translating into an 11% CAGR.
More importantly, the composition of lending is expected to improve materially:
This shift reduces concentration risk and improves yield stability, a critical driver of sustainable banking profitability.
Profitability Metrics: Margin and Efficiency Gains Ahead
Ventura Securities expects a steady improvement in operating metrics over the next three years.
| Metric | FY25 | FY28E |
|---|---|---|
| Net Interest Margin | ~2.6% | ~2.8% |
| Net Interest Income (ā¹ Cr) | ā | 12,836 |
| Cost-to-Income Ratio | ~71% | ~60% |
| Operating Profit (ā¹ Cr) | ā | 8,004 |
The brokerage believes operating leverage, better cost control, and improving asset mix will drive profitability rather than aggressive balance-sheet expansion.
Asset Quality: Stability Expected to Continue
Asset quality is expected to remain stable, with Ventura projecting:
These levels indicate a bank that has largely absorbed legacy stress and is now operating with manageable credit costs.
Return Ratios: Early Signs of Normalisation
Return metrics are expected to improve gradually:
While these numbers still trail larger private-sector peers, Ventura emphasises that the direction of change is what matters at this stage of the cycle.
Valuation and Target: Why Ventura Is Bullish
Ventura Securities concludes that Yes Bank is no longer just a āturnaround story,ā but an early-stage growth opportunity. Improving return ratios, restored stakeholder trust, and operational discipline form the core pillars of its investment thesis.
The brokerage believes the current valuation does not fully price in the bankās improving fundamentals and medium-term earnings potential.
The Bottom Line
Yes Bankās transformation appears to be entering a new phaseāone defined less by survival and more by scalability and consistency. While risks remain, particularly in execution and macro conditions, Ventura Securitiesā analysis suggests the bank is structurally better placed than in previous cycles.
For investors with a higher risk appetite and a medium-term horizon, Yes Bank is increasingly being positioned as a recovery-to-growth transition play rather than a distressed asset.
DISCLAIMER: We Are Not Financial Advisors This article is for informational and educational purposes only and does not constitute investment advice. Equity investments are subject to market risks. Readers are advised to consult a qualified financial advisor before making any investment decisions.
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