Shares of YES Bank rallied 9.70 per cent to a 52-week high of Rs 32.70 on reports of the State Bank of India (SBI) offloading its entire stake.
According to media reports, the company may sell shares worth Rs 5,000-7,000 crore through a block deal, with no taxes applicable to the sale. On February 8, approximately 26.2 crore shares, equivalent to 1.10 per cent equity valued at Rs 808.8 crore, changed hands at Rs 30.20 per share. However, the identities of the buyers and sellers were not immediately disclosed.
The report suggests that SBI's stake sale in YES Bank would aid the lender in meeting its capital requirements. Currently, the SBI Consortium holds a 32.70 per cent stake in YES Bank, with LIC holding 4.34 per cent and Axis Bank 2.57 percent.
The SBI Board is anticipated to deliberate on the share sale at YES Bank soon, with the proceeds intended to enhance the bank's balance sheet liquidity. Furthermore, if the shares are divested in the open market, it could potentially help SBI avoid equity dilution for capital needs.
The surge in YES Bank shares by 26 per cent over the past month and an over 8 percent gain in SBI shares during the same period underscore the market's positive sentiment. Earlier, HDFC Bank Group also received approval from the Reserve Bank of India (RBI) to increase its stake in YES Bank from 3 percent to 9.5 percent.
YES Bank financial performance
YES Bank reported a net profit of Rs 231 crore for Q3 FY24, up 4.4-fold on year and 2.8 per cent on quarter. Net interest income (NII) was up 2.3 per cent over year and 4.8 per cent over quarter at Rs 2,017 crore. Net interest margin (NIM) for the quarter was at 2.4 per cent, up 10 basis points on the quarter but 10 basis points lower on the year.
In the earnings call, the management said the bank is focusing on yield-accretive segments, and the increasing share of retail loans is expected to support margins going forward, even as sectoral headwinds are expected to continue to weigh.
Net Advances were up 11.8 per cent y-o-y and 4.0 per cent q-o-q to Rs 2.2 lakh crore, with the share of retail and SME loans rising to 63 per cent from 58 per cent a year ago and the share of larger corporate loans falling to 23 per cent from 29 per cent.
Disbursements for the quarter were Rs 28,498 crore, of which retail assets were Rs 9,769 crore, rural loans were Rs 1,126 crore, SME loans were at Rs 8,265 crore, and mid-corporate loans were at Rs 1,108 crore.
As of 2:36 pm, shares of YES Bank were trading 3.19 per cent higher at Rs 30.75 at the NSE.
