YES Bank shares extend rally, rise 45% in three weeks; Here's what pushing the stock higher

Shares of YES Bank Ltd extended its rally on Wednesday, amid the continued optimism after the NPA portfolio update it shared with the bourses. The stock surged about 6 per cent during the early trading session, taking the overall gains to 13 per cent in the last three-trading sessions.

YES Bank has declared that it has received Rs 120 crore from sale of NPA portfolio to JC Flowers ARC, which drew the attention of market participants. The disclosure pertained to the sale of NPA portfolio to JC Flowers ARC on December 17, 2022, said the private lender, in the filing.

Shares of YES Bank gained more than 6 per cent on Wednesday to hit a high at Rs 20.62, with a total market capitalization close to Rs 60,000 crore. The lender has surged about 13 per cent from its price at Rs 18.27 on Friday, November 10. The scrip had settled at Rs 19.39 on Monday.

Shares of YES Bank have rallied about 30 per cent in the month of November so far, while the stock is up 45 per cent from its 52-week low at Rs 14.10, hit on October 23, 2023, about three weeks earlier. However, the stock is marginally down on a year-to-date basis.

YES Bank had reported a 47.4 per cent rise in the net profit on a year-on-year (YoY) basis at Rs 225.21 crore in the September 2023 quarter, which was Rs 152.82 crore in the year ago period. The net interest income (NIIs) of the private lender were up 3.3 per cent YoY at Rs 1,925 crore in the Q2FY24.

The asset quality of YES Bank improved in Q2FY24 as gross NPA ratio came in at 2 per cent, while net NPA ratio stood at 0.9 per cent. Provisions and contingencies fell 14.1 per cent YoY to Rs 500.38 crore in the second quarter of the current financial year, which stood at Rs 582.81 crore in the year ago period.

Technical analysts suggest that the stock is headed for more upside, if it sustains above the latest resistance levels. Since the last couple of weeks, YES Bank has gained some quick momentum and placed near the Rs 20 mark, said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers

"As we advance, there will be massive resistance near Rs 22, and credible support is seen near Rs 19. On the flip side, if it closes above Rs 22 on a daily closing basis, then the doors will be open for Rs 24-26 levels in the coming few weeks," he added.

Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher said that YES Bank continues to surge ahead after giving a breakout above the Rs 19 level improving the bias and has further near-term target of Rs 22 as mentioned earlier.

"The important resistance barrier of Rs 25 zone once breached decisively can trigger for fresh upward move strenthening the overall trend and can expect for new targets of Rs 40-45 levels in the medium term to long term time frame. So, currently keeping the stop loss of Rs 18.50 one can hold the stock for further gains," he said.
 

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

Also read: Stock recommendations for November 15 2023: Tata Power, BHEL, Manappuram Finance, Union Bank and Oil India

Also read: ASK Automotive shares deliver a mild listing pop at debut; lists at 8% premium at Rs 304.90