YES Bank, whose three year lock-in period ended on March 13, saw institutions such as mutual funds and foreign portfolio investors (FPIs) trimming their stakes in the March quarter, even as Life Insurance Corporation of India (LIC) and banks stayed put on the stock.
The month of March was a bit volatile for the YES Bank stock, as it tanked 15 per cent during the period on fears select banks invested in YES Bank would selloff stakes following the end of lock-in period, triggering selloff.
Those fears, as it turned out, were unwarranted. Data showed a total of eight banks held 33.02 per cent stake in the private lender as of March 31. This is almost the same as 33.10 per cent they held as of December 31.
The SBI-led consortium, with seven private lenders, had infused money in YES Bank in a bid to restore its financial health and help it meet liquidity, capital and other critical parameters. There was a three-year lock-in on those shares. SBI was also mandated not to reduce its holding below 26 per cent in the bank.
Data showed Kotak Mahindra Bank (3.48 per cent) and HDFC (1.28 per cent) stayed put on their YES Bank holdings for the March quarter.
Instead, mutual funds trimmed their holdings in the bank to a total 3,32,19,829 shares or 0.12 per cent at the end of March quarter from 13,37,70,866 shares or 0.47 per cent at the end of December quarter. LIC's holding in the bank stood constant at 1,24,83,65,988 shares or 4.34 shares sequentially.
FPIs cut their stakes in the bank to 6,64,52,97,963 shares or 23.11 per cent stake from 6,68,47,93,256 shares or 23.25 per cent in the March quarter.
Meanwhile, retail investors increased their holding in the bank to 22.91 per cent from 22.34 per cent, up 57 basis points. HNIs also upped stake in the bank by 20 basis points to 6.98 per cent from 6.78 per cent sequentially.
Retail investors owned Rs 13,232 crore worth shares at the end of December quarter compared with Rs 10,052 crore as of September 30, 2022.
Kotak Institutional Equities expects YES Bank to see a 12.5 per cent YoY drop in net profit at Rs 321.70 crore compared with 367.50 crore in the same quarter last year. Net interest income is seen rising 6.2 per cent YoY to Rs 1,932.80 crore from Rs 1,819 crore in the year-ago quarter. Net interest margin is seen flat at 3.1 per cent.
"We expect NII to grow 6 per cent YoY reflecting the underlying business growth. Business momentum is gaining traction across retail and MSME segments but overall loan growth to be lower than industry average at 11 per cent YoY. Deposit growth at 11 per cent YoY is meeting the business requirements but has significantly decelerated in recent quarters. We expect NIM QoQ at 2.5 per cent (stable QoQ). Revenue growth pressure to remain high especially led by weak treasury income," Kotak said.
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