the cash flow statement of yes bank are in very bad condition,so how the stock move upward since 2008 to 2017
Not related to your question but curious about the indicator on the right vertical axis in pink.
Fundamental analysis of banks and NBFCs is to be done differently from other sectors. Apart from profit of bank, what matters the most is source of profit, loan book growth, book value increase etc. As far as I know for any bank most crucial are these 4 parameters:
- NIM ie Net Interest Margin or It is the difference between the interest income generated and the amount of interest paid out to their lenders (deposits), divided by total assets.
It is similar to the gross margin of non-financial companies. An ideal bank should have NIM above 3%. NIM of Yesbank is abv 3.4% consistently
NII ie Net Interest income: The excess revenue that is generated from the interest earned on assets over the interest paid out on deposits is the net interest income. Source: investopedia
NPA ie Non Performing Assets Ratio : NPA ratio is used to measure the asset quality of the bank’s loan books. NPA are those assets for which interest is overdue for more than 3 months. Net NPA ratio above 1% is not healthy. YESBANK has best in class NPA figures.
CASA ie Current Account Savings Account Ratio : This is the lowest cost source of borrowing for any bank is also measures the immediate liquidity of the bank. Yesbank CASA has improved from mere 8.5% in 2008 to 36% in 2017-18. It has been wholesale funded bank since it’s inception, but since last 6 to 7 years it’s shifting it’s business paradigm to retail thus getting stable source of funds as lower costs.
There many more parameters which I have not listed abv like capital adequacy, loan to deposits etc
For above parameters, You can compare figures of top banks like hdfcbank, indusind bank etc to check yoy nos and find out where yesbank places itself. Some of the good and trustworthy sites are valueresearchonline, moneyworks4me, equityfriend etc.
Also I request @karthik Rangappa sir to explain further in depth or make a special video tutorial on fundamental analysis of banks.
one basic principal of analysis whether fundamental or technical.
market behaves on future expectations not past news.
thnx for info
Is it not a combination of both? The weightage of both may keep varying though.
dear please read before replying,
i didn’t said both, for both you should use “and” , “or” means either