Ace investor Rakesh Jhunjhunwala on Monday bought nearly 1.3 crore shares of Yes Bank for around Rs 87 crore through open market transactions.
Bulk share sales data released by the exchanges post-market closing on Monday showed that the Midas-touch Jhunjhunwala had bought 1.3 crores shares of Yes Bank which amounts to. 0.5 percent stake in the bank. The veteran investor has paid Rs 67.10 per share leading to a total acquisition cost of Rs 86.9 crore.
Yes Bank MD Ravneet Gill told CNBC-TV18 that the bank had received a binding offer of $1.2 billion from a global investor, while a mix of private equity funds, family offices, domestic funds, and domestic family offices have shown interest in investing in the bank.
Yes Bank's common equity (CET-1) was at 8.7 percent at the end of the second quarter. But with only 43 percent of the bad loans provided for and over Rs 31,000 crore of loans rated BB and below, chances are the bank will require large dollops of capital both to clean the books and fund growth.
This is not the first time that a private bank has enthused Rakesh Jhunjhunwala. He had earlier invested in Federal Bank as well.
News of Rakesh Jhunjhunwala investing in Yes Bank can skyrocket the stock price in which case it may be able to raise capital with less dilution than envisaged until now.
Yes Bank's shares closed the day at Rs 66.10, down 50 paise for the day. The shares had fallen over 10 percent in intraday trade on Monday after the bank reported a sharp rise in non-performing assets (NPAs) and in non-NPA stressed loans.
First Published: IST