Shares of YES Bank extended their losing momentum on Friday 5th July 2019 and plunged over 8 per cent in intra-day trade to hit fresh 52-week low of Rs 88.15. The YES Bank’s share price has been on a selling spree for the last one month, falling over 42 per cent during the period, after global rating agencies such as UBS India and Moody’s Investors Service downgraded the bank’s ratings.
If we analyse the news of this stock then we are getting mostly negative news building in this stock. I have captured recent news for your reference.
If we analyse its quartely performance then since Sep 2018 its quarely net profit is in falling spree on YOY basis. Which is impacting heavely on the stock price, it has fallen from level of 404 of Aug 2018 high to 88 in July 2019. HIghlighted no. is reflecting drop in quartely profit on YOY.
Quarterly Net Profit (Cr.)
- Change in promoter holding in 3Years: -2.08 % & Non-InstitutionsHoldings are increasing which will lead to more volatility in this stock.
- It has low return on equity of 13.61% for last 3 years & Its current ROE is nearly 6.5% which much below than historical averages.
- Contingent liabilities* of Rs.658923.49 Cr
*Contingent Liability: This is the amount that a company may need to shell out in the future and its loss potential is measured in terms of the probability of those events coming to pass. Such liabilities include pending lawsuits (litigation filed against the company pending with authorities), income tax or sales tax disputes, or patent infringements.
- Still 81 % holding is with Storng Hand (Promoter & QII) as per recent shareholding pattern.
- Stock is trading at 0.76 times its book value
- Company is expected to give good quarter
- Company has been maintaining a healthy dividend payout of 19.36%
Stock is trading in complete down trend, It has broken the major support of 110–100, now stock is trading at 88 which is its new 52 week low so now technically it can keep on making new 52 low going ahead. It is following the lower top & lower bottom since last 03 months & trading below its all major moving averages in longer time frame which is a bearish sign altogether.
CMP: 88.15 Dt. 05 July 2019
Support-2&3: 65 & 45
Resistance-2 & 3: 145 & 175
(Note: Whenever price closes below its Support level or closes above its Resistance level then further move in that direction will accelerate. If it does not then it is advisable to accumulate near to support & book the profit near to resistance level.)
F&O Data & Option Chain : As per F&O data stock may take support of 90 & 80 & feel the resistance of 100, 110 & 120 in the Month of July 2019.
Conclusion( My Personal View) :
- Technical setup is very weak. One should not catch a falling knife as it may injure you, trader should follow the sell on rise strategies as it has multiple resistances going ahead, technical levels are given above. Stock is very volatile in nature.
- Fundametally it is also weak but having a brand value & backing by Strong Hand of Institutions, Investors can accumulate gradually to build the position for longer period atleast 3 to 5 Year of horizon so that your average price will be lower. It may be the kind of high risk & high reward so give lesser waitage in your portfolio as per your risk appetite and build your position slowly & steadly for longterm portfolio.
- If you want to do fresh bottom fishing in safe side then let it settle down & bounce it from lower levels. Once it sustains above the given resistance levels of 120 & 135 and RSI level is above 50 on monthlychart then one can start accumulating it.
- You can also read my earlier answer on Yes Bank:
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Above details are my personal views on the Stock so please do your own analysis before doing any trade/invest.
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