Yes Bank, Part I: The lonely contrarian.

by | Dec 15, 2018 | Dear old dad | 0 comments

Late in 2018, Yes bank catches my eye. This time I do homework, their last earnings report is full of disclosures about NPA’s. It feels like they are coming clean. There is a promoter back-story, the CEO and his sister-in-law have been in court cases for control, for several years, shares have been transferred to subsidiaries run by his daughters. The stock has taken a dive from about 400 to 180. Indians see scams everywhere I think. I have written an op-ed piece in the Economic Times, comparing market reactions to scams in India with other parts of the world (they occur everywhere with some regularity, you know, in many instances market reactions in the West to such events are even stronger than in India).

 

More news comes out, RBI refuses to re-appoint the CEO, family squabbles appear to be settling, not too many cockroaches left in this one, I think. I nibble at 180, intending to buy at 10-rupee intervals if it falls further, and it does to 150. As I worry, a new CEO is appointed, comes with a good reputation from Deutsche, more positive news. I am telling people I know about YES now, not one person can understand why I would buy the stock at all. Not many cock-roaches left, I say, nobody is convinced– Badrinath the lonely contrarian.