Why did YES Bank shares fall after strong results? Could further declines be imminent? Brokerages have given their targets and explained the reasons.

News Topical, Digital Desk : Yes Bank shares fell more than 3% on January 19 following its third-quarter results. Although Yes Bank reported a healthy increase in net profit in Q3, brokerage firms maintained a negative stance on the stock, citing concerns about weak credit growth, below-average returns, and valuations.

Yes Bank shares opened at ₹23.99 in the morning and hit an intraday low of ₹22.66. This follows a strong rally this month, rising from ₹21.66 to ₹23.99.

What did the brokerage say on Yes Bank shares?

Yes Bank reported a 55% year-on-year increase in net profit in Q3 FY26, driven by a significant reduction in provisions. However, several brokerage houses said this improvement was not supportive of a meaningful acceleration in core growth or sustainable returns.

Domestic brokerage firm Anand Rathi said the bank's retail segment remains stressed and returns on equity remain below average. It added that the increase in profitability is largely due to lower provisioning, rather than structural improvements in earnings quality.

Yes Bank shares retain SELL rating

Emkay Global has maintained its 'SELL' rating on Yes Bank shares with a target price of ₹20. This is due to weak credit growth of approximately 5% annually, driven by the retail segment. Yes Bank lags its competitors in terms of growth and returns.

Brokerage firm Citi also has a 'sell' rating on the stock. Meanwhile, according to LSEG data cited by Reuters, Yes Bank shares currently have an average 'sell' rating from 11 analysts, with a median target price of ₹18, meaning it could decline from current levels.

While brokerages broadly agree that Yes Bank has made progress in improving asset quality and cleaning up its balance sheet since its restructuring, they are not confident about the sustainability of the earnings improvement.

Read More: Why did YES Bank shares fall after strong results? Could further declines be imminent? Brokerages have given their targets and explained the reasons.