Yes Bank Ltd. is Rated Hold by MarketsMOJO

Rating Overview and Context

On 25 August 2025, MarketsMOJO revised Yes Bank Ltd.’s rating from 'Sell' to 'Hold', reflecting an improvement in the company’s overall outlook. The Mojo Score increased by 16 points, moving from 45 to 61, signalling a more balanced risk-reward profile. This 'Hold' rating suggests that investors should maintain their current positions, as the stock exhibits moderate potential for appreciation while carrying some risks that warrant caution.

Here’s How Yes Bank Looks Today

As of 31 January 2026, Yes Bank demonstrates a blend of strengths and challenges across key evaluation parameters: Quality, Valuation, Financial Trend, and Technicals. These factors collectively underpin the current 'Hold' recommendation and offer insight into the stock’s investment appeal.

Quality Assessment

The bank’s quality grade is assessed as average, reflecting a stable but not exceptional operational and financial foundation. Yes Bank has shown strong long-term fundamental strength, with net profits growing at a compound annual growth rate (CAGR) of 24.08%. This robust profit growth indicates effective management and improving business operations over recent years.

Moreover, the latest quarterly results for December 2025 reveal encouraging signs: the Gross Non-Performing Assets (NPA) ratio has declined to a low 1.50%, signalling improved asset quality and risk management. The Net Interest Income (NII) for the quarter reached a record high of ₹2,465.60 crores, underscoring the bank’s ability to generate core income efficiently. Additionally, the credit-deposit ratio for the half-year stands at 88.01%, reflecting a healthy balance between lending and deposit mobilisation.

Valuation Perspective

Yes Bank’s valuation is considered fair, with a Price to Book (P/B) ratio of 1.3. This valuation is modestly discounted relative to its peers’ historical averages, suggesting the stock is reasonably priced given its fundamentals. The Return on Assets (ROA) is 0.7%, which, while not outstanding, is consistent with industry norms for private sector banks.

Importantly, the stock’s price-to-earnings-to-growth (PEG) ratio stands at 0.4, indicating that the company’s earnings growth is not fully reflected in its current share price. Over the past year, Yes Bank has delivered a total return of 12.92%, while profits have surged by 48.4%, highlighting a disconnect that may present opportunities for value-oriented investors.

Financial Trend and Stability

The financial trend for Yes Bank is positive, supported by consistent profit growth and improving asset quality. Institutional investors hold a significant 66.87% stake in the company, and this holding has increased by 1.11% over the previous quarter. Such strong institutional confidence often reflects thorough fundamental analysis and can provide stability to the stock price.

Despite some short-term volatility, the bank’s six-month return of 11.39% and one-year return of 12.92% demonstrate resilience and moderate growth momentum. However, the three-month return shows a slight decline of 3.69%, indicating some recent market pressures that investors should monitor.

Technical Outlook

Technically, Yes Bank is mildly bullish. The stock has shown modest upward movement in the short term, with a one-day gain of 0.42% and a one-week gain of 2.24%. The technical grade suggests that while the stock is not in a strong uptrend, it is maintaining a positive trajectory that could support further gains if market conditions remain favourable.

What the 'Hold' Rating Means for Investors

The 'Hold' rating assigned to Yes Bank Ltd. by MarketsMOJO indicates a balanced outlook. Investors are advised to maintain their current holdings rather than aggressively buying or selling the stock. This rating reflects the bank’s solid profit growth and improving fundamentals, tempered by fair valuation and some recent market fluctuations.

For investors, this means that Yes Bank offers moderate potential for capital appreciation, supported by improving asset quality and institutional backing. However, the stock is not currently positioned for rapid gains, and caution is warranted given the competitive banking sector and macroeconomic uncertainties.

In summary, Yes Bank’s current 'Hold' rating is justified by its average quality grade, fair valuation, positive financial trend, and mildly bullish technical outlook. Investors should monitor upcoming quarterly results and sector developments to reassess the stock’s potential in the coming months.

Sector and Market Position

Operating within the private sector banking space, Yes Bank is classified as a midcap company. Its performance relative to sector peers is noteworthy, especially given the strong net profit growth and improving asset quality metrics. The bank’s credit-deposit ratio of 88.01% is among the healthier ratios in the sector, indicating effective utilisation of deposits for lending activities.

While the broader banking sector faces challenges such as regulatory changes and economic cycles, Yes Bank’s fundamentals suggest it is well-positioned to navigate these headwinds. The stock’s current valuation discount relative to peers may appeal to investors seeking exposure to a bank with growth potential but at a measured risk level.

Conclusion

Yes Bank Ltd.’s 'Hold' rating by MarketsMOJO, last updated on 25 August 2025, reflects a cautious but constructive view of the stock. As of 31 January 2026, the bank exhibits strong profit growth, improving asset quality, and fair valuation metrics. The positive financial trend and institutional investor confidence further support this stance.

Investors should consider maintaining their positions while keeping an eye on market developments and quarterly performance updates. The current rating suggests that Yes Bank is neither a strong buy nor a sell, but a stock with balanced risk and reward characteristics suitable for investors with a moderate risk appetite.

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