YES Bank stock slips for third straight day, hits over 5-year low

The latest worry for YES Bank stems from a disclosure regarding irregularities and unauthorised transactions at CG Power and Industrial Solution, a company in which YES Bank holds stake

YES Bank shares were trading lower for the third straight day, down 5 per cent at Rs 67.55 on the BSE on Wednesday amid uncertainty over the future trajectory of the bank's asset quality. The private lender's stock was quoting at its lowest level since March 6, 2014.

In the last three trading sessions, the stock has shed 15 per cent with the latest worry stemming from a disclosure regarding irregularities and unauthorised transactions at CG Power and Industrial Solution, a listed company in which YES Bank holds 12.8 per cent stake. CLICK HERE TO READ FULL REPORT

Thus far in the financial year 2019-20 (FY20), YES Bank's share price has tanked 75 per cent from the level of Rs 275 on March 29. In comparison, the S&P BSE Sensex has slipped 3.5 per cent thus far in FY20.

“Yes Bank is going the Axis and ICICI Bank way, which took nearly more than 2 years to come out of the non-performing asset (NPA) mess. Total stress loans (including BB & below rates exposure) stands at 13.1 per cent of the book while the provisioning on the same is hardly 20 per cent implying steep provisioning in future years,” analysts at LKP Securities said in company update report dated July 19, 2019.

“For FY20, we estimate credit growth would be flat to negative, slippages to rise more than 7 per cent mark, credit cost to be at 2 per cent, other income to fall by 5 per cent due to shrinkage in B/S, margins to drop by more than 20 bps to 2.8 per cent resulting in bank to report loss of Rs 100 crore. Capital infusion and lack of creditability to watchlist estimates raises fresh concerns on the stock,” the brokerage firm said, with target price for the stock at Rs 75 per share.

At 10:08 am, YES Bank was trading 2 per cent lower at Rs 70 on the BSE, as compared to 0.19 per cent rise in the S&P BSE Sensex. A combined 87 million equity shares changed hands on the counter on the NSE and BSE so far.