The Yes Bank scrip continued to suffer at the hands of investors, with the stock on Thursday plunging almost 13 per cent after UBS cut its price target steeply by 47 per cent.

The report comes amid Moody’s placing the lender’s ratings under review for a possible downgrade.

The international credit rating agency had cited Yes Bank’s high exposure to the struggling NBFC and realty sectors, taking into account the bank’s own disclosure of the stressed book, which it felt could put pressure on the asset quality and affect its profitability and capital position.

The foreign brokerage, which maintained a sell rating on the stock, slashed the target price to Rs 90 from Rs 170 earlier as it expects more pressure on the bank’s asset quality because of its exposure to stressed companies.

UBS expects Yes Bank’s credit costs (the amount set aside for bad loans) to rise to 250 basis points from its earlier estimate of 200 basis points. The bank’s management has given a 125-basis-point guidance for the current fiscal.

The UBS report said the brokerage was yet to consider in its pricing the fact that exposure to non-investment grade company was relatively higher for the bank.

It also expects the metrics, including margins, fee income and loan growth to “deteriorate significantly” in the current fiscal.

The impact of the report was felt on the bourses. On the BSE, the share opened lower at Rs 130.80 and sunk to a 52-week low of of Rs 116.10, a drop of almost 14 per cent. It finally settled at Rs 117.20, a fall of 12.96 per cent, or Rs 17.45, over the previous close.

On the NSE, the shares fell 13.46 per cent to close at Rs 116.60. The scrip was the worst-hit among the frontline companies on both the bourses.

Rana clarification

Rana Kapoor, the former managing director and chief executive of the bank, denied reports that he was looking to make a comeback to the bank and said he had full confidence in his successor Ravneet Gill.

“Media reports have suggested that I am attempting a comeback to the board, in spite of my unequivocal denial to them,” Kapoor said in a series of tweets.

Kapoor, who continues to hold over 9 per cent in the bank, said he has “full confidence and conviction” in Gill and the board.