YES Bank share falls 3% amid market crash

YES Bank shares fell almost 3 per cent amid Friday's sharp correction, ranking among the most active banking scrips in terms of volumes on BSE and NSE.

Extending fall for the second consecutive session, YES Bank stock opened lower at Rs 15.80 as against its previous close of Rs 16.10. Later, the stock declined 2.8 per cent to the intra-day low of Rs 15.65, amid high volatility. It also hit an intraday high of Rs 15.95 in early session.

YES Bank stock trades higher than 100-day moving averages but lower than 5, 20, 50 and 200-day moving averages.

The shares of the private lender have fallen 1.56 per cent in one week, 3 per cent in a month. Year-to-date, the stock is down 11 per cent and 56 per cent in one year.

Market capitalisation of the lender fell to Rs 0.39 lakh crore. The stock has touched a 52-week high of Rs 87.95 and a 52-week low of Rs 5.55.

Meanwhile, share market indices slipped almost 3.5% to bearish territory on Friday, amid weak global equities. Sensex was trading 1,715 points lower at 49,322 and Nifty fell by 480 points to 14,615. The private banking index was down 4.24% on BSE.

In terms of brokerage views, Emkay Research gave a 'Sell' rating to the stock and set a target price of Rs 11 for the share, given sub-par return ratios and unfavourable risk-reward with higher valuations.

"We believe that the transfer of NPAs to a separate ARC (somewhat similar to IDBI in 2003) probably means window dressing standalone bank B/sheet,but we need to see the extent of hair-cuts, structure of ARC and recovery record in the ARC, which is not inspiring in case of IDBI SASF," Emkay Research said in its report.

Kotak Institutional Equities also have a sell rating for the lender stock with a fair value of Rs 11, at a downside of 32%.

Similarly, ICICI Securities said in a recent note that YES Bank's December-quarter earnings have aggravated fears of its asset quality issues and gave a "hold" rating on the stock with a revised price target of Rs 16.

"The portfolio vulnerability becomes visible from, a spike in standstill non-performing loans or NPLs (from 1.5% to 5%), SMA-2 pool (from 2.4% to 4%), SMA-1 (from 1.6% to 7.3), and additional restructuring outside of this pool at 3.2% over and above the labelled non-performing assets at 22%," it added.

Brokerage house Geojit, as well as BNP Paribas, have a sell rating for the stock and reduced its TP. Nirmal Bang also continues to maintain a negative outlook on the bank and values the stock at Rs 13, based on 1.0x FY23E ABV.

The free-fall in YES Bank's stock to double digits was on the back of corporate governance lapses and under-reporting of NPAs. This led to the placement of the lender under a moratorium by the central bank last year. A consortium of lenders led by the country's largest lender- State Bank of India infused money into the bank to bail it out from deteriorating financial health.

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