ICICI Securities keeps Hold on Yes Bank and UltraTech Cement

what happened

According to ICICI Securities research cited by moneycontrol.com, Yes Bank reported Q2FY27 profit after tax of INR 10.8 bn, up 1% quarter on quarter and in line with expectations, with stable net interest income and pre-provision operating profit. The Supreme Court upheld a Bombay High Court ruling on the write-down of AT1 bonds worth INR 84.15 bn. The brokerage estimates pro forma CET1 would fall about 270 bps to 11.4%. The bank has not finished its assessment, and the ruling involves no cash outflow.

UltraTech Cement's volumes rose 13% year on year in Q2FY27 and revenue beat the forecast by 4%, but high operating costs kept EBITDA broadly in line. The brokerage cut its FY27E and FY28E EBITDA forecasts by about 3% and lowered its target multiple to 16x FY28E EV/EBITDA from 17x. The target is now INR 11,000, down from INR 12,138.

why it matters

A lower CET1 ratio at Yes Bank could slow lending growth or prompt a capital raise, so the AT1 dispute remains the key risk for the stock. UltraTech faces weak demand from drought, overcapacity and fuel costs tied to crude prices. Both stocks keep a Hold rating.

market impact

Yes Bank and UltraTech: the AT1 ruling lowers CET1, while cement overcapacity pressures margins and prices

tags

instruments