NEW DELHI: Shares of Yes Bank slumped nearly 12 per cent on Wednesday after Moody’s Investors Service downgraded the company’s ratings to non-investment grade and changed outlook to negative from stable.
The stock fell sharply by 11.71 per cent to end at Rs 161.70 on the BSE. During the day, it dived 12.55 per cent to Rs 160.15, its 52-week low.
On the NSE, shares of the company plunged 11.30 per cent to close at Rs 162.
The stock was the worst hit among the blue chips on both the key indices during the day.
The company’s market valuation dropped by Rs 4,909.72 crore to Rs 37,384.28 crore on the BSE.
In terms of equity volume, 154.99 lakh shares of the company were traded on the BSE and over 14 crore shares changed hands on the NSE during the day.
Moody’s Investors Service Tuesday downgraded Yes Bank’s ratings to non-investment grade and changed outlook to negative from stable on the back of various resignations from the board.
The resignations, when seen in conjunction with RBI’s September directive to restrict the term of the bank’s MD and CEO Rana Kapoor, till January 31, 2019, have raised concerns over the corporate governance, it said.
“Although the bank’s reported credit fundamentals remain stable, the developments surrounding the transition in leadership as well as the governance issues are credit negative because they complicate management’s effective implementation of the bank’s long-term strategy,” it said.
Furthermore, these developments could constrain the bank’s ability to raise new capital, Moody’s said.