Shares of State Bank of India Ltd (SBI) gained over 3% on Friday's early trade on the back of the news reports that it may consider reducing its stake in Yes Bank Ltd after a lock-in period ends on March 13.
According to Prashanth Tapse, Research Analyst, Senior VP Research of Mehta Equities Ltd, the investment infused into Yes Bank as strategic investors was around ₹6,000 crore, at ₹10 per equity share.
"If we look at Yes Bank current market price is ₹17, the investment is up by 70%. This would be post Reserve Bank of India (RBI) permission for such stake reduction. Overall we are optimistic on SBI as well as YES bank for medium to long term," added Tapse.
As per the stock exchange data, SBI initially bought 49% of Yes Bank, and currently holds 26.14% stake as of December 31, 2022.
In March 2020, after the Reserve Bank of India replaced the bank's board, SBI intervened to save Yes Bank alongside other lenders including ICICI Bank, Axis Bank, IDFC FIRST Bank, Kotak Mahindra Bank, and Housing Development Finance Corp.
On the technically front, as the stock has seen strong traction in the opening session on Friday, analysts expect positive momentum to continue, ₹570 is the next resistance, whereas ₹530 is the support level.
The stock has gained 29.68% from 52-week low of 425.0 on March 8, 2022.
According to a Mintgenie poll, 43 analysts, have recommended 'strong buy' for the stock.
