Yes Bank Limited

Started in 2003, Yes Bank Limited is new generation private sector bank, with presence covers all 28 states and eight union territories in India and one representative office in Abu Dhabi as of March 31, 2020. This is a full-service commercial bank specialising in merchant banking, digital banking, brokerage business, asset management and investment banking. As of March 31, 2020, the Bank has a network of 1,135 branches and 1,423 ATMs. In March 2020, the Government of India notified the 'YES Bank Limited Reconstruction Scheme 2020' and the Board was reconstituted with eight eminent professionals with vast experience within the banking industry. Since the implementation of the Reconstruction Scheme, they have formulated new strategic objectives which aim at augmenting deposit base and liquidity buffers, optimizing operating costs, building stronger governance and underwriting framework and focusing on stressed assets resolution over the next six to twelve months. Bank aims to develop a scalable platform as they focus on the retail and SME advances. The strategic initiatives in the enhancement of the SME capabilities include financing vendors of corporates, tie ups with trade and industry relationships and expanding the liability business through branches and CRM based sourcing. As of March 31, 2020, bank has 50 dedicated SME branches in SME hubs they intend to increase the customer base in corporate banking, medium enterprises banking, SME banking and retail banking business segments through a focused customer relationship management approach. On financial performance front, Yes Bank has posted turnover/net profits of Rs. 20,642.80 cr. / Rs. 3,339.89 cr. (FY17), Rs. 25,561.75 cr. / Rs. 4,233.21 cr. (FY18), Rs. 34,299.28 cr. / Rs. 1,709.27 cr. (FY19) and Rs. 29,593.12 cr. / Rs. (166,432.58) cr. (FY20). So financials are currently in bad position and bank is trying to improve them. As part of that SBI had bought 49% in the bank. Comparison between peers are shown in above table. On BRLM's front, 8 lead managers are managing the FPO. As per financials, company suffered setback like some other banks and due to higher NPA. As company has made huge loss in FY20, so valuation is negative, but as per book value and CMP, FPO is coming at very good discount. Also big players like SBI, HDFC, ICICI, etc had bought stake in Yes Bank at Rs 10. With FPO amount, the bank may again go in growth mode. So for long term one may consider to apply and so we give SUBSCRIBE rating to this FPO.

• 1 Mr. Edward Menezes
• 2 Mr. Sunil Chari