Shares of private setor lender Yes Bank Ltd fell sharply in Thursday’s trade amid heavy volumes. The stock came under intense selling pressure after news agency Reuters, citing sources, reported that the State Bank of India (SBI) may lower its stake in Yes Bank after a lock-in period ends on March 6, 2023. The three-year lock-in period was put in place by the Reserve Bank of India (RBI). The board of SBI is likely to meet soon to decide on the future of its stake in Yes Bank, following which a proposal will be sent to the RBI, the report further stated.
Yes Bank tanked 5.41 per cent today to hit a day low of Rs 17.31 over its previous close of Rs 18.30. The counter has slipped 19.17 per cent so far this year. A total of 384.35 lakh shares changed hands today on BSE, which was two times higher compared to the two-week average volume of Rs 168.03 lakh shares. Turnover on the counter stood at Rs 68.98 crore, commanding a market capitalisation (m-cap) of Rs 50,924.03 crore.
SBI, along with other lenders, had stepped in to rescue Yes Bank in March 2020, after the RBI superseded its board. The country’s largest lender had initially acquired 49 per cent of Yes Bank. As of December 2022, it held a 26.14 per cent stake in the private lender as it couldn’t reduce the holding below 26 per cent before the completion of three years.
In September last year, Yes Bank had said that the RBI would allow it to exit a reconstruction scheme only after the share lock-in period ends.
The stock traded higher than 5-day, 20- and 200-day moving averages but lower than 50-day and 100-day moving averages. The counter’s 14-day relative strength index (RSI) came at 53. A level below 30 is defined as oversold while a value above 70 is considered overbought. The lender’s stock has a price-to-equity (P/E) ratio of 59.63.
That said, Yes Bank has an average target price of Rs 19.30, Trendlyne data showed, suggesting a potential upside of 9.04 per cent. The scrip has a one-year beta of 1.01, indicating average volatility.
Meanwhile, Indian equity benchmarks returned to negative territory after recording a jump in the previous session, dragged by technology, banks, financials and automobile stocks. The 30-share BSE Sensex pack dived 502 points or 0.84 per cent to close at 58,909; while the broader NSE Nifty index moved 129 points or 0.74 per cent lower to settle at 17,322.
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