JPMorgan cuts YES Bank target price to Re 1 from Rs 55

Mumbai: JP Morgan on Thursday cut its target price on YES Bank to Re 1 from Rs 55 after media reports suggested State Bank of India (SBI) and state-run Life Insurance Corporation of India (LIC) may pick up 49 per cent stake in the company for Rs 2 per share.

“We believe the forced bailout investors will likely want the bank to be acquired at near zero value to account for risks associated with the stress book and likely loss of deposits,” JP Morgan analyst said in a note.

The foreign brokerage added that it remains underweight on the lender and believes net worth of the bank is largely impaired.


SBI and LIC are set to pick up 49 per cent stake in YES Bank by acquiring preferential shares in the private lender at Rs 2 per share, sources told ET NOW. The two state-run firms will acquire the stake for Rs 490 crore, the report added.

SBI will likely be given exemption from open offer. It should be noted that a similar exemption was given to the lender in case of Union Bank of India in November 2019.


Earlier in the day, the scrip jumped 25.77 per cent to close at Rs 36.85 on BSE.