The shares of RBL Bank in intra-day trade on Wednesday fell as much as 20% to hit a 52-week low of Rs. 230.55. The fall in the stock price has come after brokerage firms turned cautious on the stock due to its poor September quarterly reports.
The bank has reported a sharp spike in its provisions, at the same time its asset quality has worsened with gross NPAs as a percentage of gross advances increasing 122 bps sequentially to 2.6% and net NPS increasing q-o-q to 1.56%.
Net profit at the bank for the September quarter fell 73.4% to Rs. 54.31 crore in comparison to Rs 204.54 crore in the same period last year.
Earlier the bank owing to tough corporate credit situation faced problems with some of the corporate accounts.
"As a matter of prudence, we have taken higher than required provisions on these accounts which have impacted our bottomline," MD & CEO, RBL Bank said in a BSE filing.
Global brokerages have turned bearish on the stock and have downgraded the stock with an underweight call.
Morgan Stanley after assigning underweight rating to the stock has reduced its target price by 40% to Rs. 240 from the earlier Rs. 400 per share.
JPMorgan also has placed underweight call on the stock of RBL Bank and cut target price by 15% to Rs 280 from Rs 330 as it holds the view that asset quality will have a negative impact on near-term profitability.
Shares of RBL Bank were last quoting lower by 12.16% at Rs. 252 on the BSE.