Ace investor Rakesh Jhunjhunwala bought a 0.5 per cent stake in troubled private-sector lender YES Bank for Rs 86 crore on Monday. Data from exchanges showed that Jhunjhunwala bought 12.9 million shares of YES Bank at price of Rs 67 apiece in a bulk deal on the BSE.
The bank has lately seen some recovery in its share price after informing exchanges that it had a binding offer from a global investor for an investment of $1.2 billion.
An infusion of capital would come as a much-needed relief for the bank, with its capital adequacy ratio barely above the regulatory requirements, as of June disclosures. "It would give the bank the growth capital to compete in the current environment and look at regaining its lost market share," said a fund manager who did not wish to be named.
The common equity Tier-I capital of the bank, as of June 2019, was eight per cent, close to the regulatory requirement of 7.37 per cent till March 2019.
The YES Bank share prices has risen over 44 per cent in a one-month period, with talks of a fresh investment improving investor sentiment on the counter.
On Monday, the bank's managing director & chief executive officer Ravneet Gill said in a TV interaction that the overall bids received by the bank were to the tune of $3 billion. On Monday, the company's share price closed 0.7 per cent lower at Rs 66.1.