The prominent private sector lender, known for its banking services and corporate relationships, has posted impressive growth in its third-quarter results. The latest financial report showcases significant improvements in net profit, deposit growth, and asset quality, with a notable surge in corporate advances and a substantial reduction in net non-performing assets, signalling a strong recovery trajectory.
Share Price Movement
The share price of Yes Bank Limited is up 3.5 percent to Rs. 18.88 per share on Monday, an increase from its previous close of Rs. 18.24 per share. The market capitalisation now stands at approximately Rs. 58,347 crore as of January 27, 2025.
Outlook on profitability
Two key trends are driving profitability improvements: the balance of deposits placed to meet PSL shortfalls declined to 8.5% of assets (from 10.4% in Q2 FY25), aiding net interest margin and operating profit growth, while flat retail slippages QoQ are expected to lower gross credit costs. These align with prior guidance.
Q3 Financial Highlights
Yes Bank reported a 164.52% surge in Q3 FY25 standalone net profit to Rs 612.27 crore (vs. Rs 231.46 crore in Q3 FY24). Net Interest Income (NII) grew 10.2% YoY to Rs 2,224 crore, with Net Interest Margin (NIM) stable at 2.4%. Provisions fell 53.36% YoY to Rs 258.68 crore.
Gross NPAs dropped 11.08% YoY to Rs 3,963.47 crore, while net NPAs declined 40.93% YoY to Rs 1,142.62 crore. The gross NPA ratio improved to 1.6% (from 2%), and the net NPA ratio fell to 0.5% (from 0.9%).
Total deposits grew 14.6% YoY to Rs 2,77,224 crore, and total advances increased 12.6% YoY to Rs 2,44,834 crore. The CASA ratio rose to 33.1% (from 29.7%).
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Competitors
Yes Bank competes with leading Indian banks like HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, and SBI, which dominate the sector with strong market capitalisations and P/E and P/B ratios.
Yes Bank has a P/E of 26.36, which is more than the industry P/E of 10.25.
Market Outlook
The Indian banking industry is thriving, driven by strong economic growth, digital payment adoption, and financial inclusion efforts. Key developments include UPI expansion, rural credit digitalisation, and fintech innovations. With policy support like CBDC pilots and WhatsApp banking, the sector is modernising rapidly.
By 2025, the Indian fintech market is expected to reach $150 billion, solidifying India’s position as the third-largest global fintech ecosystem. These advancements ensure increased access to credit and financial services nationwide, supporting sustained economic growth.
Written By Fazal Ul Vahab C H
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