RBL Bank's Share Price Bearish At 52-Week Low, Investors' Concerns

The post-Christmas period, for the RBL Bank's management, is not a very pleasant time. The bank's share prices fell to a 52-week low range as the bank's management had some changes, with immediate effect.

Till 10.06 am, on Monday, December 27, RBL's share price fell to Rs. 138.35, falling by 20%. RBL is a country's popular bank and has a good investors base in the equity markets. However, this bearish trend is attracting new investors to the bank. On December 24, RBL Bank's share price was traded at Rs. 173.10/share, till last traded. So, this fall is very significant for the bank's record this month. The bank started with a good boost in its share price. On December 9, RBL's share price reached Rs. 199.05.

The Reserve Bank of India appointed Mr. Yogesh K Dayal, Chief General Manager, RBI, as an additional director on the board of the RBL Bank for 2 years. Later, the bank stated in its regulatory filing that Managing Director (MD) and Chief Executive Officer (CEO) Vishwavir Ahuja has proceeded on leave with immediate effect. The bank had its board meeting on December 25, 2021, to decide on that, and has appointed Mr. Rajeev Ahuja as an interim managing director and CEO. The Bank's management which is now being team led by ED Mr. Rajeev Ahuja is having support from the central bank. However, as an aftermath of these events, on the equity markets, RBL's share price dropped significantly in the morning, on December 27. The bank or the RBI did not state any clear reason behind these decisions.

RBL Bank is a 78-year-old bank headquartered in Mumbai, and this current bearish trend will have two folds impact on the markets. The old, existing shareholders are being uncertain about the future price trend. While new investors are getting scope to buy RBL's shares at a low price.

Significantly, in Q2 of this fiscal, the bank's profits were damaged because of higher provisions. In addition to that, the bank's Gross Non-Performing Assets (Gross NPA) and Net NPA have increased by 5.4% and 2.14%, respectively on quarter. In the same quarter, Gross NPA and Net NPAs were reported at 3.34% and 1.38%, respectively.