Yes Bank share price rises 6% as Carlyle, Advent International to invest $1.12bn; Should you buy, sell hold?
Yes Bank share price rose 5.7 per cent to Rs 15.80 on BSE on Monday after the bank announced that private equity funds Carlyle and Advent International will invest USD 1.12 billion. Technical analysts say that any major move in Yes Bank is likely to remain above 15.85. “So all up moves should be used for exits. Fresh buys are not advised at current levels. In fact, any minor moves on the higher side should be used for exits,” said Milan Vaishnav , CMT, MSTA, consulting technical analyst and founder, Gemstone Equity Research & Advisory Services, told FinancialExpress.com.
Both global PE funds will acquire a 10 per cent stake each in Yes Bank, which had to be bailed out by the Reserve Bank of India (RBI) and the government-led reconstruction plan due to lack of capital buffers and the failure of the then management. To sell the bank’s story to investors. “Yes Bank will raise funds through a combination of approximately $640 million in shares and approximately $475 million in share warrants. It will offer 3.69 billion shares to Carlyle Group and Advent’s affiliates. The company will also issue 2.56 billion share warrants to both the investors at a price of Rs 14.82 per warrant,” the private lender said in a statement.
Ravi Singh, VP and Research Head, Share India Securities told FinancialExpress.com that since the bank announced its plan to raise funds through rights issue, preferential allotment etc., the stock of Yes Bank has gained momentum. . The bank has also posted better than expected. Earnings figures for the June 2022 quarter with a sharp decline in gross NPAs. However, a limited upside is indicated on the technical setup with a target of Rs 17-18 levels in the near future.
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Despite positive news of Yes Bank planning to raise capital by selling its stake in PE firms, Tips2Trades co-founder and trainer AR Ramachandran believes this rally can be used to book profits in the event of a previous buyout. needed. “As the broader markets turn overbought, we believe Yes Bank may retest the 12.7-13 level again,” Ramachandran told FinancialExpress.com.
In the last five days, the share price of Yes Bank has risen between 8 per cent and 20 per cent in a month. On a year-on-year (YTD) basis, the stock has gained 7.5 per cent and over 13 per cent in the past six months. In terms of trading volume, a total of 4.03 shares were exchanged on the BSE, while 17.64 crore shares were traded on the National Stock Exchange so far.
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