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HomeBusinessYes Bank share price dips over 15% in YTD. Accumulate or exit?

Yes Bank share price dips over 15% in YTD. Accumulate or exit?

Yes Bank’s share price has been below the sell-off after climbing to a 52-week high 24.75 on December 13, 2022. In this nearly one-month span, shares of Yes Bank are down 30 percent, while it’s down more than 15 percent YTD.

According to stock market experts, this dip in Yes Bank shares is short-lived as major banks are expected to bounce back from their lows. They said Yes Bank’s share price has plummeted following the weak-looking Q3 results and the recent Bombay High Court order overturning Yes Bank’s manager’s decision to write off additional Tier-1 or AT-1 bonds , was destroyed.

On why Yes Bank’s share price is falling, Ravi Singhal, CEO of GCL Broking, said: “Recently, Yes Bank’s shares have fallen due to two main reasons: Bombay High Court overturned Yes Bank’s manager’s decision to grant AT- 1 Bonds and Weak Looking Q3FY23 Results Both reasons for Yes Bank’s share price fall are short-lived as Yes Bank intends to go to the High Court against the order of the Bombay High Court and the Q3 results look weak due to provisions selling its stress pool to JC flowers ARC Yes Bank has also reported growth in its operating profit, both quarter-over-quarter (QoQ) and year-over-year (YoY). i would advise Yes Bank shareholders to run the stop loss script 17 and see this dip as an opportunity to rally around 18 levels each.”

Chinmay Barve, Head — Technical and Derivative Research at Profitmart Securities, expects a recovery in Yes Bank shares and said: “Yes Bank has placed crucial support with 17 levels each and shareholders of Yes Bank are advised to maintain stop loss at 17 levels. On chart pattern, there is a strong chance that Yes Bank shares will bounce back strongly from the recent lows and move up 20 y 22 levels each. However, in case the stock breaks 17 support then 15 would be a good buying range for long term investors. High-risk traders and investors can buy the stock at current levels for a short-term target of 20 but for those who want to play it safe they can buy Yes Bank shares around 15 and hold long.”

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ICICI Securities gives Yes Bank shareholders the option to hold on to the scrip despite a 30 percent drop from its 52-week high. Following the forced sale of the pool, the adjusted book value (adjusted for net NPAs) was favorably impacted by 8-10%, despite lower earnings accrual for FY23E. 89 billion in Q3FY23 from Carlyle and Advent provides YES with growth and trust capital. To that extent, the stock can now command a valuation of 1.4x FY24E ABV (previously 1.2x).

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ICICI Securities pointed to the challenges Yes Bank shares may face, saying: “We remain aware of the risks arising from the delay in the settlement of a stressed pool, incremental provisions related to obsolescence, a modest RoE profile during the transition, the decision to write off AT-1 bonds will be challenged in court and stock excess after stock lock-in ends on March 23. Maintain HOLD with a revised target price of 19.3 per share.”

disclaimer: The views and recommendations made above are those of individual analysts or brokerage firms, and not of Mint. We recommend that investors check with certified experts before taking anything investment decisions.


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