YES Bank shares extend losses for third day, fall 2%
NEW DELHI: YES BankNSE -1.09 % shares declined over 2 per cent in morning trade on Wednesday and looked on course to extend the losing streak into the third consecutive session.
The stock has been in the negative territory since last Monday, May 6, 2019 after domestic rating agency IcraNSE -0.53 % downgraded the bank’s long-term bond ratings and gave a guidance with a negative outlook.
Icra downgraded the ratings on six instruments for total borrowings of over Rs 33,000 crore by the lender, after it reported a surge in BB and below-rated advances in March quarter to 7.1 per cent under the new chief executive Ranveer Gill.
The agency had placed the ratings under watch with negative implications last November, after RBI refused to let the bank’s promoter-chief executive Rana Kapoor to continue beyond January 31, citing corporate governance and other concerns, which ultimately led to Gill’s appointment in March.
The bank reported its maiden loss of over Rs 1,506 crore in March quarter, driven by a near 10-fold spike in provisions.
The disappointing Q4 numbers led to quick downgrades by several brokerages, with Macquarie going for a double-downgrade while lowering the price target by 30 per cent.
Emkay Global downgraded the stock to ‘sell’ from ‘hold’ and cut price target by 40.5 per cent to Rs 155.
The bank on Tuesday said it acquired eight crore shares in electric equipment maker CG Power, which had been pledged with it by a borrower. The acquired shares represent 12.79 per cent ownership in the company and will be valued at Rs 292.56 crore as per the Tuesday’s close.
Shares of YES Bank traded 1.61 per cent down at Rs 161.90 on BSE at 10:25 am