The current state of the stock market: Early morning trade showed a significant increase in Yes Bank’s share price following an upgrade by the international rating agency Moody’s. Within minutes of the opening bell, Yes Bank shares reached an intraday high of ₹27.09 per share, after opening with an upside gap on the NSE at ₹26.10 apiece.
Stock market experts explained that Yes Bank’s shares are climbing today because the private lender’s outlook was raised by global rating agency Moody’s from “stable” to “positive,” which led to aggressive purchasing in the early morning trading session.
Why are the shares of Yes Bank soaring today?
“Global rating agency Moody’s has upgraded its outlook on Yes Bank from stable to positive,” stated Avinash Gorakshkar, Head of Research at Profitmart Securities, in response to a question about the direct cause of the company’s spectacular share price increase. During the early morning session, this led to the purchase of Yes Bank shares.”
Gorakshkar explained that the shift in prognosis for Yes Bank reflects the anticipation of global brokerages over a possible increase in the private lender’s depositor base. Furthermore, a notable increase in Yes Bank’s asset quality is highly anticipated, which may result in a stronger financial situation. Though the brokerage has insisted that Yes Bank’s profitability will continue to lag behind its Indian competitors, one should not lose sight of the fact that Moody’s is still unconvinced about the bank’s profitability.
The Profitmart Securities expert speculated that the recent speculation over Yes Bank’s $5 billion stake sale would also have contributed to the shares’ sharp increase during morning trading. However, First Abu Dhabi Bank has denied the news of its stake purchase. Since the private lender and other parties have not made any official announcements addressing news regarding share sales, he encouraged investors to check out what Moody’s has said about Yes Bank.
Top 5 things Moody’s stated on Yes Bank
Avinash Gorakshkar responded, “Change of outlook, improvement in Yes Bank’s asset quality and capitalization, improvement in pre-provisioning profits to total assets, reduction in operating expenses by meeting the RBI’s PSL rules through new lending, and weak profitability against the Indian peers are the top 5 takeaways from the Moody’s outlook on Yes Bank,” when asked about the top 5 statements made by the global brokerage about the bank that Indian stock market investors should pay attention to.
Target share price for Yes Bank
With the price of Yes Bank shares expected to rise, “Yes, bank shares are facing a challenge at the ₹28 per share level,” said Sumeet Bagadia, Executive Director at Choice Broking. Nevertheless, if this obstacle is overcome, Yes Bank’s stock price may rise to ₹32 per share. Thus, to capitalize on the possible rise, Yes Bank shareholders may continue to retain their investment with a stop loss set at ₹24.50 per share.
Bagadia knew exactly what to do when it came to new investors and Yes Bank stock. With an emphasis on the buy-on-dips strategy, he suggested that novice investors contemplate purchasing and retaining Yes Bank stocks. To maintain the stock above ₹24.50, this entails purchasing additional shares during price falls. The ₹28 and ₹32 per share targets can be attained with this approach.”
Disclaimer: Stockeasynow provides stock market news for informational purposes only and should not be construed as investment advice. Readers are strongly encouraged to consult with a qualified financial advisor before making any investment decisions.
