Rana Kapoor and his family’s stake in Yes Bank shrunk to 1.6 per cent as promoter shares were invoked and sold by Milestone Trusteeship, which, people in the know say, was on behalf of Reliance Nippon Life Asset Management (RNam).
Further, the people said that shares sold belonged to Kapoor himself, as the quantity of shares offloaded was the same as those held by Kapoor. Queries sent to Kapoor and RNam weren’t answered at the time of going to press.
According to the bulk deal data on the NSE, the debenture trustee sold 100 million shares at a weighted average price of Rs 35.29, translating to Rs 352.9 crore of shares. According to analysts, the share sale may have added to selling pressure in Yes Bank on Tuesday.
The stock closed 23 per cent lower at Rs 32 on BSE. Kapoor and his family have been taking steps to reduce debt on promoter entities, by selling these entities’ holdings in bank to prepay debenture holders.
On September 26, Yes Capital (YCPL) — one of the promoter entities — sold 1.8 per cent stake in the bank to prepay the entire outstanding non-convertible debentures of YCPL. The sale amounted to Rs 241 crore of shares. The payments were made to Franklin Templeton AMC, for NCDs maturing in October 2020.
On September 19, Morgan Credits sold Rs 337 crore of YES Bank shares, to prepay a certain part of its outstanding dues to RNam. On September 17, CARE Ratings downgraded Morgan Credit’s NCDs from “A-” to “BBB-”. The revised rating accounted for the moderation in equity cover due to the fall in the price of underlying shares of YES Bank.
According to the rating note, these NCDs are Zero Coupon Bonds set for maturity on April 19, 2021. However, the sharp correction in the YES Bank stock hit the equity cover on these exposures.
On July 18 and July 22, MCPL had pledged 70.25 million shares in favour of Milestone Trusteeship (debenture trustee), which represented its entire stake in YES Bank. On July 18, Rana Kapoor had also pledged his entire stake of 100 million shares.