Blog | Why you should hold YES BANK Shares...

The bearish candle can melt anytime and energize the bulls to run steadily. Yes Bank's post-crisis fundamentals seem to be winning & recovering silently in the market. Is it right for media & news channels to lose hope on YES BANK or is it the grim and heavy silence before the gigantic profit waves?

Finocontrol experts always recommend one to follow one's instinct and guts rather than eyeing upon institutional investors who have a smart approach, high-risk tolerance capabilities & massive volume of funds to pump & dump shares. Sometimes, few illegal investing loopholes get managed with legal patches fooling the retail Investors.

What happened to Yes Bank?

Yes Bank was one of the leading private banks ranking in between 3rd best and 5th best in the world. It is engaged in providing banking services, including corporate and institutional banking, financial markets, investment banking, corporate finance, branch banking, and wealth management.

Yes Bank's Management had been performing very poorly since February 2018, which wasn't visible in the public domain. Moreover, dark days of Yes Bank came in September & October 2018, when Yes bank's shares saw a sharp fall from ₹400/share to ₹175/share.

Hence after, in early 2019, the bank experienced multiple breakdowns and higher NPAs (Non-Performing Assets). Rana Kapoor's unethical banking practices further deteriorated the situation leading to severe losses for all the shareholders, retail & institutional investors, depositors, employees & the entire banking ecosystem.

Top 6 Reasons Dragging Yes Bank to land in Upper Circuits:

1. There has been an extensive change in the Results & Performance since March 2020, as the Management changed and was led by the CEO Mr Prashant Kumar, who joined SBI as a PO Officer.

2. In October 2020, SBI announced the new change in Management & Strictly Supervised few massive internal aspects of the bank.

3. After the change in the Management structure &Corporate governance, there has been strict compliance for all the stakeholders.

4. Rules, Laws, Transparency, Regulations, Policies& Standards have been well structured & are visible in the financials of last quarter results.

Let us have a look on the Trend in deposits pre crisis & post management changes.

The analysis above provides a clear picture of people, gaining trust in the Yes bank.

As Rana Kapoor(CEO of Yes Bank) was found guilty & there was massive financial distress amongst the middle-class people, we can see a sharp fall in the number of depositors which decreased from ₹2 Lakhs crores in September 2019 to ₹1,05,364 Crores in March 2020.

Ever since, Mr Prashant Kumar took charge as the CEO of Yes Bank in March 2020, there has been a 28% increase in deposits to ₹1,35,815 crores in September 2020, in a few months.

Yes Bank has witnessed a whooping recovery and a vertical rise in deposits in a very short period during this pandemic proving the efficiency & ability of Mr Prashant Kumar to drive the bank into a bright future.

Yes Bank is slowly rising from slumber while regaining trust among the customers.

1. After studying Yes Bank's loan & NPA books Finocontrol experts have found that the bank is using conservative defensive strategies for lending purposes. This can be quite a constructive approach to balance bad debts & playing safe.

2. Yes Bank will be shutting down 50 branches as part of a rationalization effort. It will help the bank in reducing rents, which were a massive operational overhead for lenders, by 20 per cent.

Few Recent Updates that will drive Yes Bank's Bulls to be aggressive:

MSCI Inc., The world's largest index compiler with assets worth $15 trillion in benchmarked indices, has included Yes Bank to its standard index - MSCI India Domestic Index, after its semi-annual review.

On Tuesday, CARE Ratings revised its rating on Yes Bank's debt instrument. The rating agency has revised the bank's infrastructure bonds rating to 'CARE BBB' from the previous 'CARE B' rating.

CARE has also revised its outlook to 'Stable' from the previous "Under Credit watch with Developing Implications" on the aforementioned instruments.

As per the CNBC Sources, The rating agency has also given 'CARE BB+' rating on both YES Bank's Upper Tier II Bonds as well as Perpetual Bonds (Basel II) from previous 'CARE D'.

There are pending 'buy' orders of 1,17,46,781 shares, with no sellers available which signify that a massive volume of Investors bidding for Yes Bank.

Final Call: Yes Bank had a significant contribution to the finance & banking industry for a long time & had a visible market share in India. The fall of Yes Bank can invite dark days for the entire Indian Economy. Thus, RBI, SBI, and other massive private commercial banks won't let it happen easily, which is evident from major share distributions getting acquired by other banks to stabilize Yes Bank's scenario. Here is the Distribution:

HDFC Life has joined hands with Yes Bank to sell insurance policies to the bank's customers across the country. According to Ramanjeet Mohanty (Founder, CFO of Finocontrol), this may have a positive impact on the Yes Bank share and the private lending stocks may grow up to ₹22 - ₹25 per share from its current ₹12- ₹14 per share levels. We can see that Yes Bank is currently facing a strong hurdle at ₹17 per share and once it breaks this resistance, it may go up to ₹25 per share soon.

Best Case Scenario: Students & Retail Investors can find themselves the best time to buy Yes Bank within the price band of ₹10/share to ₹15/share & hold it for a minimum of 1 year to 18 months. This might be a lucrative deal with a minimum risk involved under securing principle value upon holding. The shares will see an appreciation with a 200% Gain on its current trading share prices. Depending upon the Volume of your Initial Investment, Yes Bank can yield profits in lakhs within 18-24 months which is considered to be a small time-period in the value investing journey.

Favourable Case Scenario: Students & Retail Investors can find it suitable within the aforementioned, price range. As per the Fundamental & Technical analysis, Yes Bank has 90% chances to reach ₹17/share-₹18/share which can yield you a decent or above-average return over a 6-8 months timeline or maybe less than that. Start selling in between ₹18/share - ₹21/share.

Worst Case Scenario: Hold patiently and the severity of risk might result in nil returns but won't go negative, Finocontrol is known for holding it's subscribers trust & hard-earned money with utmost esteem. The investment will yield better returns since the bank is recovering in the ecosystem. Buy & Hold!

Stay tuned for further more interesting & Insightful Investment Analysis content which simplify your decision making process. Yes, Bank Basket Diversification strategies will be coming soon!

The Article/blog is written on 11 November 2020. Any future events, updates, and change in regulation is over marked. Drop me a like if you endorse this content and comment below your suggestions. We don't directly encourage any Investors to invest in the markets. Investments are always subject to Market Risks. Consult us on a one-on-one session to know more! At Finocontrol, we don't promote any paid article from companies to favour decisions. We are an independent financial services venture for students & Retail Investors & believe in the transparency, trust of our Subscribers.The Article/blog is written on 11 November 2020. Any future events, updates, and change in regulation is over marked. Drop me a like if you endorse this content and comment below your suggestions. We don't directly encourage any Investors to invest in the markets. Investments are always subject to Market Risks. Consult us on a one-on-one session to know more! At Finocontrol, we don't promote any paid article from companies to favour decisions. We are an independent financial services venture for students & Retail Investors & believe in the transparency, trust of our Subscribers.

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