YES Bank share price tumbles over 10% after report of price target cut by global brokerage

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Updated: June 13, 2019 12:17:57 PM

Shares of Yes Bank fell as much as 10.43 per cent to Rs 120.7, lowest since August 24, 2015, after reports said that the global brokerage UBS reduced private lender’s target price

Yes Bank’s exposure to Indian housing finance companies (HFCs) and non-bank finance companies (NBFCs) stood at 6.4% of its total exposure at the end of MarchYES Bank had hit an intraday high of Rs 404 on 20 August last year.

Shares of Yes Bank fell more than 10 per cent per cent after reports said that the global brokerage UBS reduced private lender’s target price to Rs 90 from Rs 170. It comes a couple of days after global rating agency Moody’s placed private lender’s foreign currency issuer rating of Ba1 under review for downgrade. In the last one month, the shares have declined 18 per cent. The Bank had hit a record high of Rs 404 on 20 August 2018.  Since then, there is a contunuous fall seen in the share price. At 11:45 am today, the shares fell to Rs 118, implying a fall of 70 per cent from the record high.At the NSE, shares declined 12.87 per cent to Rs 117.40, its 52-week low. Shares of Yes Bank had fallen more than 3 per cent Wednesday also.

At the time of reporting, the shares were trading at Rs 119.15, down 15.50 points, or -11.51 per cent on BSE.

In its note, Moody’s had said that the liquidity pressure on the domestic finance firms is expected to impact the credit profile of YES Bank since it has substantial exposure to the weaker firms in the sector. “The ongoing liquidity pressures on finance companies will negatively impact the credit profile of Yes Bank, given its sizeable exposure to weaker companies in the sector,” a Moody’s note said.

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Rs 10,000 crore of the exposures were classified by the bank in April 2019. It represented 4.1 per cent of its total loans under the watchlist that may turn into bad loans in the coming 12 months, Moody’s had also said.

Meanwhile, the private lender posted  a surprise net loss on account of the provisions surging more than nine times in the quarter ending March of FY19. It had posted a profit of Rs 1,179 crore in the corresponding period last fiscal.

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