Yes Bank share price rises 18% in a month. What is driving banking stock?

Yes Bank stocks have been in an uptrend for the past few sessions. During Friday’s session, this share of private lenders ended up 3 percent, after rising more than 5 percent in the past week. Similarly, the Yes Bank share price has risen from 12.65 to 15 levels each, yielding a return of over 18 percent for shareholders over this time horizon.

Stocks of Yes Bank are rising, according to stock market experts, following private lenders’ fundraising announcement and strong first-quarter earnings. They said the stock is currently trading in the range of 12.50 to 16.20 and it can go up to 19 on breaking the top hurdle at this range. However, they advised investors to buy Yes Bank shares only when it closes above 16.20 each levels.

On why Yes Bank shares are rising, Ravi Singh, Vice President and Head of Research at Share India said: “Yes Bank shares have been rising since the bank announced its fundraising plan through rights issue, preferential allocation etc. The bank has also – Outperformed earnings for the June 2022 quarter with a significant decline in gross NPAs, but a limited increase is suggestive of the technical setup with a target of 17 to 18 apiece levels in the short term.”

Speaking about the chart pattern of Yes Bank stocks, Ravi Singhal, CEO of GCL Securities, said: “Yes Bank stocks are in the immediate 13.80 to 16.20. However, a wider range of Yes Bank is: 12.50 to 16.20 and it can go up to 18 to 19 levels each after breaking the top hurdle placed on 16.20 each levels. Those who have Yes Bank shares in their portfolio are advised to upgrade the trailing stop loss to 13.80 levels. However, one should only buy the shares if the Yes Bank shares above close 16.20 each.”

Yes Fundraising at the bank

On Friday evening, Yes Bank announced that its shareholders’ equity of approximately $1.1 billion (almost approximately 8,900 crore) from funds affiliated with two global private equity investors – Carlyle and Advent International, with each investor potentially acquiring a stake of up to 10 percent in Yes Bank. This will be raised through a combination of nearly $640 million (approximately 5,100 crore) in shares and about $475 million (almost 3,800 crore) through stock warrants.

Prashant Kumar, Managing Director & Chief Executive Officer at Yes Bank, said of the fundraiser: “We are delighted to have such trusted investors as Carlyle and Advent International on board as our partners in fulfilling the Bank’s long-term strategy. This is testament to the inherent strength of the Bank’s franchise. We are excited about the increasing opportunities this partnership creates for us and are confident that both investors will play a vital role in the bank’s next phase of growth.”

Disclaimer: The views and recommendations made above are those of individual analysts or brokerage firms, not Mint.

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