After 11% slide, are YES Bank shares looking attractive? Market experts share views

Shares of YES Bank Ltd saw a sharp correction in Tuesday's trade, diving around 11 per cent to slip below Rs 21 level. The stock tumbled 10.74 per cent to hit a day low of Rs 20.77.

The private lender's counter has been active lately, following State Bank of India's (SBI) announcement last month that it would offload 13 per cent of its stake in YES Bank to Japan's Sumitomo Mitsui Banking Corporation (SMBC) at a price of Rs 21.50 per share. The transaction is expected to be completed within 12 months from the date of execution, or as mutually decided by the parties.

Currently, SBI holds a 24 per cent stake in the Mumbai-based YES Bank. Post the SMBC deal, SBI's shareholding is projected to decline to 10.81 per cent. Among other domestic stakeholders, Kotak Mahindra Bank, Axis Bank, ICICI Bank and Life Insurance Corporation of India (LIC) collectively own 11.34 per cent in YES Bank. Additionally, private equity firms Advent International and Carlyle reportedly hold stakes of 9.2 per cent and 6.84 per cent, respectively.

Market experts believe that YES Bank has navigated through its challenging phase, positioning the stock as an 'attractive' long-term bet at current market price. They noted that a decisive close above the Rs 23–24 range could pave the way for further upside potential.

"Large block deals took place in YES Bank today. I believe those who had entered YES Bank through investments, which were done in the Rs 12-13 range some time ago, some profit booking has probably happened today. It could also be from various entities to whom the government had allotted shares when the bailout of YES Bank happened. The price at which the Japanese (SMBC) have entered would now become the benchmark for YES Bank. Rs 20-23 would be the comfort range and a only decisive move above Rs 23 can trigger any further upside potential, for which you need to give new owners at least six months before you get some indication of which way the bank is moving," market veteran Arun Kejriwal said in an interview with Business Today.

"The bank has weathered the storm. So, this could be a bet from a three- to three-and-a-half years perspective. The price point of Rs 21 is quite attractive as it doesn't hurt the pocket and there's not much risk on the downside," he also said.

"For YES Bank, the overall base has been shifted from Rs 16 to Rs 18.5-19 levels, acting as support. On the higher end, Rs 24 will be a major hurdle for the counter and till the stock holds below Rs 24, it would be advisable to 'sell-on-bounce'. A decisive close above Rs 24 will change the structure of the stock for the medium- to long-term. Until that happens, the counter would be sideways with upside capped," said Arpit Beriwal, Manager – Derivatives Analyst (Equity Research) at Motilal Oswal Financial Services.

If the stock manages to close above Rs 24, it could open the door for a potential rally towards Rs 27.2 and eventually up to Rs 32.8, Anshul Jain, Head of Research at Lakshmishree Investment and Securities, suggested.