YES Bank shares were trading marginally lower on Thursday after ten straight sessions of gains, amid profit-booking by investors and weakness in broader benchmark indices Sensex and Nifty. The stock has delivered 19.78% returns to its investors in the last 10 days and gained Rs 2 since then.
Reversing the trend after 10 days of consecutive gains, YES Bank share price today opened at Rs 14.57 today and later rose to the day's high of Rs 14.69 on BSE. However, the stock also hit the day's low of Rs 14.45, falling 1.5% against the earlier close of Rs 14.68.
There have been no bulk or block deals on the YES Bank counter in the last one week. Shares of the private lender that have traded in single digits this year hit a 52-week high of Rs 87.95 and a 52-week low of Rs 5.55. In terms of shareholding, domestic investors have decreased holdings in the lender by 7.43% on Sept 20.
Share of the private sector lender has risen over 15% in one month. However, the stock has fallen 68% since the beginning of the year. YES Bank stock stands higher than 5, 20, and 50-day moving averages but lower than 100 and 200-day moving averages. Market capitalisation of the lender has fallen to Rs 36,630.27 crore.
Shares of the private sector lender rallied for ten consecutive days with benchmarks Sensex and Nifty hitting fresh lifetime highs. The stock also saw high buying activity following news of YES Bank's inclusion in the MSCI India Index.
As many as 12 companies, including YES Bank will be added to the MSCI India Index, as per the latest MSCI Global Standard Index rejig announcement. This helped the stock gain momentum as inclusion in the MSCI Global Standard Index, widely used by international fund houses for benchmarking global equities portfolios, could attract fresh inflows of capital from overseas into the private lender. All changes in constituents for the MSCI global standard indices will be implemented at the close of November 30, 2020.
Further, the stock of the troubled lender also rose after CARE Ratings revised its rating on the lender's debt instruments. The rating agency revised the bank's infrastructure bonds rating to 'CARE BBB' from the previous 'CARE B'. Also, the brokerage revised YES Bank's outlook to 'Stable' from the previous "Under Credit watch with Developing Implications" on the above-mentioned instruments. It has also given 'CARE BB+' rating each on YES Bank's Upper Tier II Bonds and Perpetual Bonds (Basel II) from previous 'CARE D'.
In the second week of November, the lender's shares rose after it denied media allegations that said the bank was gearing up to sell its non-performing assets (NPAs) worth Rs 32,344 crore to asset reconstruction companies (ARCs) or other potential investors.
YES Bank said in a clarification note, "Certain news articles reported by media carry a reference to pricing of the said stressed portfolio and specific structure, which is speculative and has no bona fide reference. The Bank at this point is not part of such specific discussions."
It added later, "The Bank would like to clarify that, the Bank in its normal course of business explores options of selling NPAs to ARCs as it may deem necessary."
However, the stock price of troubled private sector lender fell continuously in the first week of November after it reported June-Sept quarter earnings. The lender posted a net profit of Rs 129.37 crore for the September quarter compared with a Rs 600.08-crore loss posted in the corresponding period last year. On a quarter-on-quarter (QoQ) basis, profit jumped 183% against Rs 45.44 crore in Q1 of the current fiscal. Asset quality improved amid a decline in provisions during the September quarter of the current fiscal.
Sequentially, YES Bank's net interest income (NII) rose 3.4% to Rs 1,973 crore in Q2 from Rs 1,908 crore in the previous quarter. On a yearly basis, NII was down by 9.7% from Rs 2,186 crore.
Meanwhile, most brokerages have given a sell rating to the stock. Recently, BNP Paribas as well as Geojit Financial Services also assigned a 'reduce' rating to YES Bank stock. As per Kotak Institutional Equities estimates, YES Bank has seen sequential increase in deposits. However, the brokergae has given a sell rating to the troubled lender, at a target price of Rs 15, with a fair value of Rs 11.