Foreign brokerage Macquarie maintained an ‘underperform’ rating to the Yes Bank stock.

According to the brokerage house, YES BANK stock has a target price of Rs 8. This is 62% lower than current traded price. “Yes Bank has not been making operating profits for last 2 quarters. The retail and institutional investors are taking their deposits to safer banks. There is a lock-in on salaries that expires in a year. This could potentially see employees, including members of the sales force and senior management, leave the bank.

As per Rahul Kapur, partner with Kapur Sharma & Co. Stock Brokers, banking sector is likely to go through a phase of crunch, which will hit the weaker banks and NBFC more. YES Bank already has asset quality issues. Its NPAs will rise further after the loan moratorium is lifted. The banking sector would require additional capital to shore up its balance sheet. This will entail huge supply of equity & debt papers over next 2-3 years. This shall pose another challenge for Yes Bank stock.

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