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Published: May 03, 2024
Updated: May 03, 2024

YES Bank Shares Rebound Amid Carlyle Group's Reported Block Deal

Early Jitters

The trading day for YES Bank started with a dip of about 3.5%, with shares opening at Rs 24.55. Investors seemed jittery amidst reports of a block deal involving Carlyle Group, which aimed to offload a 2% stake in the private lender. However, the stock swiftly rebounded, gaining 5.17% to reach Rs 25.82.

Block Deal Buzz

Speculations swirled around a potential block deal by Carlyle Group, with Goldman Sachs reportedly appointed as the banker for the transaction. The deal was anticipated to occur at around Rs 25 per share, adding fuel to market activity and driving heavy volumes on both NSE and BSE.

Market Dynamics

As of 9:40 am, over 73.58 crore shares of YES Bank were traded on NSE, amounting to Rs 1,803.85 crore, while 2.35 crore shares worth Rs 59.21 crore changed hands on BSE. The surge in trading volumes hinted at the execution of the block deal, although independent verification was pending.

Investor Response

Despite the initial dip, investor sentiment quickly rebounded, with YES Bank's shares gaining momentum during the session. The stock's resilience was evident as it closed higher than the previous trading session's settlement of Rs 25.44 on Thursday.

Carlyle Group's Position

Carlyle Group, through its investment arm CA Basque Investments, currently holds an 8.74% stake in YES Bank as of March 31, 2024. This reported block deal comes after Carlyle's earlier sale of a 1.4% stake in the bank, worth approximately Rs 1,057 crore.

Regulatory Hurdles

In a regulatory filing, YES Bank disclosed a service tax demand order imposing a penalty of over Rs 6.42 crore. The bank received the order from the Office of the Commissioner of GST & Central Excise, Maharashtra, adding a layer of regulatory challenge to its operations.

Financial Performance

Despite regulatory hurdles, YES Bank reported a stellar standalone net profit of Rs 452 crore for the quarter ended March 31, 2024, marking a remarkable 123% jump year-on-year. The bank also saw a significant increase in interest income, further bolstering its financial position amidst market fluctuations.

The rebound in YES Bank shares amidst reports of Carlyle Group's block deal underscores the dynamism of the market. Despite regulatory challenges and fluctuations, the bank's strong financial performance reflects its resilience and potential for growth. Investors continue to monitor developments closely, navigating the ever-changing landscape of the banking sector with cautious optimism.