Stock to watch: Yes bank is in a bullish zone

The shares of Yes Bank have been outperforming markets in the past few trading sessions.

The shares of Yes Bank have been outperforming markets in the past few trading sessions. There is a steady increase in volumes traded in Yes Bank even as its shares jumped 18 per cent in one month.  

Yes Bank has proven to be one of the biggest wealth destroyers for long-term investors as its share price dipped more than 95 per cent in the past five years. However, after SBI purchased stakes in the bank and the new management took over the operations, investors have been betting on the revival of the beleaguered private bank. Once touted to be one of the top-performing private banks, it has been struggling for funds lately. 

Last week, at least two large global private equity players announced their interest in Yes bank. Carlyle and Advent International will be acquiring up to a 10 per cent stake in Yes Bank. The money will be raised by Yes Bank through a combination of nearly $640 million (about Rs 5,100 crore) in equity shares and around $475 million (near Rs 3,800 crore) through equity share warrants.  

While this augurs well for capital-starved Yes Bank, the investors also have a rationale to stay bullish on the counter, owing to the positive set of results announced in the June quarter where the gross NPA (GNPA) dropped drastically.  

Improving financial condition, backed by large global private equity players and overall demand for financials (companies operating in the financial sector) can be expected to have a positive impact on the share price of Yes Bank.  

Technically, the shares of Yes Bank are in a bullish zone. Investors and momentum traders can keep Yes Bank on their watchlist!