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Informist, Thursday, Jan. 15, 2026
 

By Eshitva Prakash

 

MUMBAI – YES Bank Ltd. is expected to report a year-on-year rise in its net profit for the December quarter on the back of easing cost of funds, according to analysts tracking the company. The lender's net interest income is seen rising on steady recoveries in its retail loan portfolio.

 

The private sector bank is expected to report a net profit of INR 7.48 billion for the December quarter, up a little over 22% on year, according to the average of estimates from four brokerages. Sequentially, the net profit is seen rising over 14%. This projection implies a slight acceleration in net profit growth from the 18% on-year rise in the trailing quarter.

 

While three brokerages expect year-on-year growth in bottom line, Kotak Securities Ltd. sees a slight decline in net profit. Kotak expects the company's provisions to rise over 72% on year to INR 4.46 billion and pull the net profit down. The bank's provisions had risen 41% on year to INR 4.19 billion in the September quarter. Kotak Securities also has the lowest estimate for the company's pre-provisioning operating profit at INR 12.54 billion, up 16% on year. JM Financial Securities Ltd. and ICICI Securities Ltd. see a 30% and 25% on-year rise in the pre-provisioning operating profit, respectively.

 

The lowest net profit estimate is INR 6.02 billion by Kotak Securities and the highest is INR 8.37 billion by Emkay Global Financial Services Ltd. 

 

A trade-off between loan growth and net interest margin still persists, albeit with weaker intensity, ICICI Securities said about the banking sector. The impact of the December rate cut effected by the Reserve Bank of India's Monetary Policy Committee is likely to be limited on December quarter core yields, which may, however, be affected by slippages in agriculture-related loans, loan mix changes, and re-pricing of loans linked to the marginal cost of funds based lending rate.

 

However, the brokerage expects the cost of funds to ease for YES Bank due to repricing of term deposits. YES Bank had cut its savings account rate to 3–5?ross a range of deposits from Apr. 21. ICICI Securities also sees the bank's credit costs decreasing on year.

 

YES Bank's net interest income is seen at INR 24.34 billion for the December quarter , according to an average of estimates from the four brokerages. This implies an over 9% on-year rise and a near 6% on-quarter growth. JM Financial has the highest estimate for the bank's net interest income at INR 24.86 billion, while Emkay Global has the lowest estimate of INR 23.93 billion, despite estimating the highest net profit for the private sector bank. 

 

The bank's core performance is expected to remain weak and slippages are expected to remain elevated, according to Emkay Global. The bank's provisional loan growth has been "disappointing", the brokerage said. However, due to the bank's cautious attitude in select segments of its retail loan portfolio, Kotak Securities sees a 9% rise in the net interest income despite slow loan growth. Steady traction on recoveries and upgrades from the retail portfolio in the December quarter are expected to help the company's net interest income rise, the brokerage said.

 

YES Bank saw moderate credit growth in the December quarter with loans rising a little over 5% on year to INR 2.58 trillion as on Dec. 31. The deposits were at INR 2.92 trillion as on Dec. 31, up 5.5% on year. After the September quarter results, the bank's management had said it expects double-digit loan growth in the current financial year.

 

The net interest margin is expected to remain broadly unchanged in the December quarter, in line with industry trends. NIM is expected to be broadly stable on quarter for most banks, with some support from the cut in the cash reserve ratio, ICICI Securities said. In the June monetary policy meeting, the RBI had cut banks' CRR by 100 basis points to 3% in four phases. Emkay sees YES Bank's NIM to be comparable to the September quarter figure, while Kotak Securities sees a 6 bps rise on quarter. "There is likely to be a lot of volatility (in NIMs), given the nature of income booked when security receipts mature and the impact of RIFD (Rural Infrastructure Development Fund) investments," Kotak Securities said. YES Bank's NIM was unchanged on quarter at 2.5% in Jul-Sept.

 

Of the six brokerage reports available with Informist on Yes Bank, three brokerages have a 'sell' recommendation, two have a ‘buy' call, and one recommends holding the stock.

 

YES Bank's shares have risen marginally since its September quarter earnings were released. On Wednesday, shares of the bank closed at INR 22.95 on the National Stock Exchange, up almost 1% from the previous close. YES Bank will release its December quarter earnings Saturday.

 

The following are the December quarter earnings estimates for YES Bank from four brokerages in descending order of the estimate of net profit in INR million:
 

Brokerage Firm	Net Interest Income	Net Profit
Emkay Global Financial Services Ltd.	23,933	8,374
ICICI Securities Ltd.	24,297	7,766
JM Financial Institutional Securities Pvt. Ltd.	24,864	7,750
Kotak Securities Ltd.	24,254	6,015
Average	24,337	7,476.25

 

End

 

Reported by Eshitva Prakash

Edited by Vandana Hingorani

 

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