Stocks

Yes Bank rally for for fourth consecutive day; shares zoom 50%

PTI New Delhi | Updated on March 18, 2020 Published on March 18, 2020

Shares of Yes Bank continued to rally for the fourth consecutive day on Wednesday, sharply rising by 50 per cent after SBI chairman said the bank was keel to up stake to 49 per cent in the private lender.

The scrip jumped 49.95 per cent to ₹87.95 on the BSE.

On the NSE, it zoomed 48.84 per cent to ₹87.30.

In four days, the scrip has risen a whopping 251 per cent.

 

Shares of Yes Bank had jumped over 59 per cent on Tuesday also after Moody’s upgraded the company’s ratings.

Announcement of a restructuring plan has triggered the rally in the scrip.

State Bank chairman Rajnish Kumar on Tuesday said the country’s largest lender that owns close to 43 per cent in Yes Bank now would not sell a single share before that mandated three-year lock-in period, and that he’s, in fact, keen to approach the board for hiking the holding to 49 per cent.

 

Under the RBI and government-driven rescue of the fourth largest private lender, SBI was initially asked to take up to 49 per cent by investing ₹7,250 crore into the equity capital of Yes Bank.

But as seven other lenders came on board, it could pick up only around 43 per cent or 60.50 crore shares for ₹6,050 crore.

Explaining the rationale for the lower stake, the chairman said: “since investor interest was overwhelming, which met the current capital requirement, we chose to pick up only so much in the first round of fund raising.”

“In fact, I am keen to move my board to seek permission to increase the stake to the maximum permissible 49 per cent and that it’s my commitment that SBI will not sell a single share before the three-year lock-in. This is despite the regulatory and government permission to pare down our equity to 26 per cent by after three years. And I don’t see my board saying no to the proposal as well,” Kumar said.

Further, the moratorium on Yes Bank would be lifted by 6 pm on March 18, as per the reconstruction scheme notified by the government on Friday.

Yes Bank CEO-designate Prashant Kumar on Tuesday said there are no worries on the liquidity front and that complete operational normalcy would be restored from 6 pm on Wednesday.

Published on March 18, 2020
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