Yes Bank: Need To Sustain Above 820-835 Zone For Further Rally

Technically, Yes bank need to sustain above 820-835 zone for further rally up to 910-930-101;

Otherwise it may face selling pressure and sustain below 805-790 may fall again towards 710-665 area.

Trading Idea: Yes Bank

CMP: 800

Either sell below 805 or on rise around: 820-835;

TGT: 770-728-710*-691-665*-631 (1-3M)

TSL> 850

Note: Consecutive closing (3 days) above 850, for any reason, Yes Bank may further rally up to 910-930 & 1015 in the near to long term (alternative bullish case scenario).

Although Yes Bank performed quite well on the back of its retail strength and below expected stressed assets (RBI-AQR), going ahead, incremental average PAT growth around 25% YOY may be difficult to maintain on the retail franchise only and deterioration of corporate loan accounts with lack of corporate loan growth may hurt. 

Retail loan volumes can't be a substitute for corporate credit growth in the long run and when corporates are in severe stress, retail will bound to follow it later.

As par BG metrics and current market parameters:

TTM EPS: 57.11 (FY:15)

Projected FWD EPS: 59.40-65.50-71.80 (FY:16-18)

Avg PE: 15

Present median valuation of Yes Bank may be around: 805 (FY:15/TTM)

Projected fair valuations might be around: 820-860-900 (FY:16-18/FWD)

SCRIP	EPS(TTM)	BV(Act)	P/E(AVG)	Low	High	Median	200-DEMA	10-DEMA
YESBANK	57.11	277.93	15	795.34	805.48	800.41	738.42	757.36

YESBANK

59.4

375.05

15

811.13

821.47

816.30

738.42

757.36

YESBANK

65.5

450.5

15

851.76

862.62

857.19

738.42

757.36

YESBANK

71.8

540.25

15

891.78

903.15

897.47

738.42

757.36

Analytical Charts: