Yes Bank Net Income jumped on 24.0% in 2015

22-04-2015 • About Yes Bank ($YESBANK) • By InTwits

Yes Bank reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:

Yes Bank has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.0%. At the same time it's in pair with industry average of 1.3%.
CAPEX is quite volatile: 1,131 in FY2015, 1,337 in FY2014, 1,069 in FY2013, 955 in FY2012, 272 in FY2011
The company has business model with low profitability: ROIC is at 8.7%
It operates with high leverage: Net Debt/EBITDA is 4.8x while industry average is

Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

Yes Bank ($YESBANK) key annual financial indicators

mln. INR	2011	2012	2013	2014	2015	2015/2014
P&L
Revenue	46,722	71,485	95,544	116,169	136,783	17.7%
Net Income	7,271	9,770	13,007	16,113	19,974	24.0%
Balance Sheet
Cash	30,760	23,325	33,388	45,416	52,407	15.4%
Short Term Debt	30,127	83,949	128,944	114,087	99,320	-12.9%
Long Term Debt	37,548	59,564	81,603	101,106	166,293	64.5%
Cash flow
Capex	272	955	1,069	1,337	1,131	-15.4%
Ratios
Revenue growth	-75.9%	53.0%	33.7%	21.6%	17.7%
Net Income Margin	15.6%	13.7%	13.6%	13.9%	14.6%	0.7%
CAPEX, % of revenue	0.6%	1.3%	1.1%	1.2%	0.8%	-0.3%
ROIC	11.8%	9.8%	8.4%	8.4%	8.7%	0.3%
ROE	21.1%	23.1%	24.8%	24.9%	21.3%	-3.7%

Revenue and profitability

The company's Revenue jumped on 17.7% in FY2015.

Net Income marign increased slightly on 0.73 pp from 13.9% to 14.6% in FY2015.

Capital expenditures (CAPEX) and working capital investments

Yes Bank's CAPEX/Revenue was 0.83% in FY2015. CAPEX/Revenue decreased slightly on 0.51 pp from 1.3% in FY2012 to 0.83% in FY2015. Average CAPEX/Revenue for the last three years was 1.0%.

Return on investment

The company operates at good ROE (21.27%) while ROIC is low (8.71%). ROIC showed almost no change in FY2015. ROE decreased on 3.7 pp from 24.9% to 21.3% in FY2015.

Leverage (Debt)

Debt jumped on 23.4% in FY2015 while cash jumped on 15.4% in FY2015.

Management team

The company's CEO is Rana Kapoor. Rana Kapoor has 5 years tenure at the company.

Appendix 1: Peers in Banks

Below we provide Yes Bank benchmarking against other companies in Banks industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.

Top companies by Revenue growth, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Dcb Bank ($DCBBANK)		26.7%	26.2%	22.5%	25.3%
Bank Of India ($BANKINDIA)	-66.6%	30.3%	12.4%	18.1%
Karur Vysya Bank ($KARURVYSYA)	-67.4%	45.9%	29.7%	16.5%
Union Bank Of India ($UNIONBANK)	-70.8%	26.9%	19.5%	15.7%
United Bank Of India ($UNITEDBNK)	-59.5%	24.6%	18.7%	14.4%
Median (28 companies)	-59.5%	28.5%	15.6%	10.3%	25.3%
Yes Bank ($YESBANK)		53.0%	33.7%	21.6%	17.7%

Top companies by CAPEX/Revenue, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Kotak Mahindra Bank ($KOTAKBANK)	1.3%	1.4%	1.4%	2.6%
Karur Vysya Bank ($KARURVYSYA)	4.2%	2.0%	2.9%	2.5%
Dhanlaxmi Bank ($DHANBANK)	6.8%	3.0%	1.7%	2.2%
Jammu & Kashmir Bank ($J&KBANK)	5.6%	1.4%	1.3%	2.2%
Lakshmi Vilas Bank ($LAKSHVILAS)	4.4%	2.1%	1.4%	1.6%
Median (27 companies)	1.3%	1.2%	1.2%	1.3%	1.9%
Yes Bank ($YESBANK)	0.6%	1.3%	1.1%	1.2%	0.8%

Top companies by ROIC, %


Top 5	FY2011	FY2012	FY2013	FY2014	FY2015
Axis Bank ($AXISBANK)	10.2%	9.6%	8.9%	9.1%
Karnataka Bank ($KTKBANK)	5.5%	6.8%	10.2%	7.7%
Kotak Mahindra Bank ($KOTAKBANK)	7.8%	6.8%	6.5%	7.1%
Oriental Bank Of Commerce ($ORIENTBANK)	12.4%	7.6%	7.4%	6.7%
Karur Vysya Bank ($KARURVYSYA)	19.1%	14.5%	11.0%	5.3%
Median (28 companies)	7.0%	6.8%	6.0%	3.2%	6.0%
Yes Bank ($YESBANK)	11.8%	9.8%	8.4%	8.4%	8.7%

Yes Bank stock price chart

Yes Bank financials

mln.	FY2010	FY2011	FY2012

Revenue	193,807	46,722	71,485
EBITDA	0.000	0.000	0.000
Net income	4,777	7,271	9,770
CAPEX	156.8	271.8	955.4
Debt	48,731	67,675	143,513
Cash	19,953	30,760	23,325

About Yes Bank

Yes Bank Limited provides banking and financial services in India and internationally. It operates through Treasury, Corporate/Wholesale Banking, Retail Banking, and Other Banking Operations segments. The company offers corporate and commercial banking services, including working capital finance, specialized corporate finance, trade finance, cash management, vendor and channel finance, treasury risk management services, debt capital market offering, liquidity management solutions, and investment banking solutions. It also provides financial services to corporates, public sector undertakings, central and state government entities, and NBFCs. In addition, the company offers trade finance, cash management services, financial market products, and INR account services to international customers. Further, the company provides business banking services to small and medium businesses; and retail banking products, including secured business loans, car loans, two wheeler loans, commercial vehicle loans, construction equipment loans, loans against securities, tractor loans, gold loans, personal loan products, and home loans. Additionally, it offers transaction banking services comprising cash management services; trade finance services; and bank to issuer, dividend/interest payout, and escrow account services. The company also provides investment banking services, including mergers and acquisitions, divestitures, private equity syndication, and IPO advisory services; and cards, mobile banking, online banking, tax and insurance solutions, and remittance services. As of December 31, 2014, it operated 600 branches in metro, urban, semi-urban, and rural centers in India. The company also operates 1,139 ATMs; and 2 national operating centers in Mumbai and New Delhi. Yes Bank Limited was incorporated in 2003 and is headquartered in Mumbai, India.