Why Is Yes Bank Share Price Skyrocketing in 2025? Explained

Yes Bank's stock has experienced a significant surge in 2025, capturing the attention of investors and market analysts alike. Several strategic developments and improved financial metrics have contributed to this upward trajectory.

Strategic Investment by SMBC

A pivotal factor in Yes Bank's stock surge is the strategic investment by Japan's Sumitomo Mitsui Banking Corporation (SMBC). In May 2025, SMBC agreed to acquire a 20% stake in Yes Bank for approximately ₹13,483 crore ($1.58 billion), marking one of the largest cross-border banking deals in India. 

This investment not only strengthens Yes Bank's capital base but also signals confidence from a leading global financial institution. The deal involves SMBC purchasing a 13.19% stake from the State Bank of India and the remaining 6.81% from a consortium of Indian banks. 

Anticipated Fundraising Initiatives

Investor sentiment has been further bolstered by Yes Bank's announcement of a board meeting scheduled for June 3, 2025, to discuss potential capital fundraising. The agenda includes deliberations on issuing equity shares, debt securities, or other financial instruments. Such initiatives are expected to enhance the bank's financial flexibility and support its growth plans.

Improved Financial Performance

Yes Bank's recent financial results have exceeded market expectations, contributing to the positive outlook. The bank reported a 164.5% year-on-year increase in net profit for Q3 FY25, amounting to ₹612.3 crore. Additionally, the Gross Non-Performing Asset (GNPA) ratio improved to 1.6%, down from 2% the previous year, indicating better asset quality. 

Positive Credit Rating Outlook

In July 2024, Moody's Ratings upgraded Yes Bank's outlook from stable to positive, affirming the bank's Ba3 long-term foreign currency and local currency ratings. This change reflects expectations of gradual improvement in the bank's depositor base and lending franchise, which are anticipated to enhance core profitability over the next 12-18 months. 

Analyst Perspectives

Market analysts have observed that Yes Bank's stock is trading above key moving averages, with momentum indicators suggesting a continued uptrend. Subash Gangadharan, Senior Technical/Derivative Analyst at HDFC Securities, recommends buying Yes Bank shares around ₹26.65, targeting ₹31, with a stop loss at ₹24.

Investor Outlook

The confluence of strategic investments, improved financial health, and positive market sentiment positions Yes Bank favorably for sustained growth. Investors are advised to monitor developments closely, considering both the opportunities and inherent risks associated with the banking sector.

Note: This article is based on information available as of June 2, 2025. Investors should conduct their own research or consult financial advisors before making investment decisions.