InvestorQ : I understand that Yes Bank has been downgraded. What will be the impact on the price of the stock on Tuesday?
Katherine Gonsalves made post

I understand that Yes Bank has been downgraded. What will be the impact on the price of the stock on Tuesday?

Answer
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Rutuja Nigam answered.
1 year ago


The stock has been downgraded by Macquarie via a double downgrade and they have reduced the price target of the stock by 40%. This was after the company announced a massive loss of Rs.1507 crore in the fourth quarter ended March 2019. Macquarie has set a price of target of Rs165 for the stock which is substantially lower from current price levels.

What happens to the stock on Tuesday?

Very clearly the stock is going to be under pressure. However, we are not sure if you will get an opportunity to sell the stock as it is expected to open sharply lower. However, the undertone of the stock has turned weak in the back of the sharp rise in the gross NPAs. You can use any bounces in the stock price to either short the stock in futures or buy put options on the stock to play it on the downside. For now the stock will remain a “sell on rises” story.