Buzzing stock | Yes Bank's credit rating upgraded; stock rallies over 11 percent, hits 52-week high

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Shares of Yes Bank gained as much as 11 percent during the early trade on Thursday, hitting a new 52-week high after Care Ratings upgraded the lender's credit rating.

Yes Bank shares were trading at Rs 15.73, up 1.04 points, or 7.08 percent higher on the BSE. The private lender has been in demand among investors so far in the new financial year. The stock has rallied about 33 per cent so far in the month of April.

Care Ratings has revised Yes Bank's ratings for its infrastructure bonds worth Rs 5,000 crore a notch to 'BBB+' with a positive outlook, from 'BBB' with the same outlook earlier.

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Its Lower Tier II Bonds and Tier II Bonds (Base III) too have received a similar upgrade from the agency, the lender said in a regulatory filing on BSE. The rating for Upper Tier II bonds has been revised to 'BB+' with a positive outlook.

The ratings agency revised the bank's debt instruments in light of the bank's continued business growth and stabilisation of operations, which includes deposits and advances, as well as a strong surge in CASA deposits and improving profitability despite the Covid-19-related stress, among other factors.

Furthermore, the ratings continue to take into account the bank's improved credit profile following the implementation of the bank's reconstruction scheme and the subsequent capital raise through a Follow-on Public Offer (FPO) in July 2020, which increased the bank's capitalisation level and increased its ability to absorb asset quality shocks as well as provide growth capital.

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Earlier this week, the bank shared its Q4 business update in which it said its net advances grew by 8.8 percent to Rs 181,508 crore, whereas, deposits grew by 21 percent to Rs 197,281 crore. The credit to deposit ratio stood at 92 percent as of March 31, 2022, compared to 102.4 percent a year ago.