YES Bank shares rally 10%, hover near upper circuit: What's driving surge?

YES Bank share price: Shares of YES Bank jumped 9.6 per cent in trade on Tuesday, logging an intraday high at ₹19.44 per share, hovering near its upper band of ₹19.5 per share on BSE. The upward movement in the stock came after reports suggested that Japanese banking giant Sumitomo Mitsui Banking Corp (SMBC) was in advanced talks to acquire a significant stake in the private sector lender.   However, in its regulatory filing later, the bank said that the discussions are preliminary and the reports are speculative.  

"The Bank is on a growth trajectory and routinely explores opportunities with various stakeholders, which are aimed at enhancing shareholder value. However, such discussions are preliminary and do not warrant a disclosure under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, at this stage. The information pertaining to these discussions as set out in the article is speculative at this time and are not factually correct," 

 

 

Following the clarification, YES Bank shares pared some gains and were trading 1.52 per cent higher at ₹18 per share on the BSE. In comparison, the BSE Sensex was up 0.28 per cent at 80,569.52. The market capitalisation of the company stood at ₹56,566.54 crore. The 52-week high of the stock was at ₹27.41 per share and the 52-week low of the stock was at ₹16.02 per share. 

 

In past one year, YES Bank shares have lost 26 per cent as against Sensex's rise of 9 per cent.  READ STOCK MARKET LATEST UPDATES TODAY LIVE

 

The deal is being coordinated with the State Bank of India (SBI), which holds 24 per cent in YES Bank. If the deal goes through, it would mark SMBC’s biggest investment in India to date, exceeding its $2 billion acquisition of a 74.9 per cent stake in Fullerton India Credit in 2021. Not just that SMBC will emerge as the bank’s largest shareholder. However, there is no clarification on whether other institutional investors—such as HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, LIC, Carlyle, and Advent International— have plans to exit.

 

SMBC is likely to acquire a 51 per cent stake in the YES bank, which would trigger a mandatory open offer for up to 26 per cent of the bank’s equity under Indian regulatory norms.

 

Besides, reportedly the Reserve Bank of India (RBI) has given SMBC verbal assurance that it would be permitted to retain a majority economic interest in YES Bank. However, in line with existing regulations, voting rights would remain capped at 26 per cent.  ALSO READ | Ather Energy shares make lacklustre D-Street debut; list at 2% premium

About YES Bank

YES Bank is an Indian private-sector bank that offers a comprehensive suite of financial services, including retail, MSME, and corporate banking, along with investment banking, wealth management, and digital payment solutions.