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I have been through various kernels where scaling is done on y_train and y_test and many where there isn't. Is there any specific rule which should be followed when to or when not to do this?

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As far as I know, scaling target values is not the common practice, though I do not expect it to change results much. Here is a more detailed discussion of this issue:

https://stats.stackexchange.com/questions/111467/is-it-necessary-to-scale-the-target-value-in-addition-to-scaling-features-for-re

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