YES Bank share price fell in early trade today after Kotak Institutional Equities cut its target price to Rs 40 from Rs 55 per share. The brokerage also maintained its sell call on the mid cap stock. Share price of YES Bank lost 7.13% to Rs 39.10 compared to the previous close of Rs 42.10 on BSE. YES Bank stock has lost 15% in the last three sessions. The stock has lost 79.43% during the last one year. Market cap of YES Bank fell to Rs 9,895 crore on BSE. 48.42 lakh shares of the bank changed hands amounting to turnover of Rs 19.50 crore on BSE.
The brokerage sees no strong visibility of 15 percent return on equity or 1-1.2 percent return on assets in the medium term. Earnings will likely be volatile in the medium term. Also, near-to-medium-term prospects are likely to be hit by fundraising delay, Kotak Institutional Equities said.
On January 10, Uttam Prakash Agarwal, independent director and chairman of YES Bank's Audit Committee resigned. The stock has fallen 18% from Rs 47.3 (closing on January 9) to Rs 38.75 today. Agarwal cited deteriorating corporate governance standards and compliance failure in the bank as the reason for his resignation.
The lender said it was reviewing 'fit and proper' status of Agarwal for appointment on the board as directed by the Reserve Bank of India and he quit prior to the commencement of proceedings of the meeting. Agarwal was appointed as independent director on November 14, 2018 and his tenure was to end in November 2023.
The bank in its board meeting held on January 10 approved raising of funds of up to Rs 10,000 crore in one or more tranches through qualified institutional placement (QIP) or any other private placement of equity or debt. The private lender also said that it would not proceed with the offer made by Erwin Singh Braich/SPGP Holdings.
By Aseem Thapliyal