Yes Bank shares was trading 5 percent higher at Rs 31.45 around noon in February 9. This small-ticket size banking counter has been seen robust momentum after the Reserve Bank of India (RBI) allowed HDFC Bank to acquire up to 9.50 percent stake in the lender.
Major broader restructuring initiatives such as the transfer of investment banking and merchant banking businesses from Yes Securities to Yes Bank, too, have contributed to this positive trend.
Here's how technical analysts and traders are positioning Yes Bank:
Yes Bank has been in massive momentum, capturing the overall euphoria built in the small-ticket size banking counters. "On the technical front, the counter has given a massive breakout above 24 and is standing near the weekly resistance of the 32-33 mark," Arun Mantri, Founder of Mantri Finmart, said.
Any break above Rs 33 may trigger a second round of an upmove towards 40 plus levels in the medium term. The overall chart looks positive, with support for the stock placed around Rs 26-27, and above Rs 32, the stock may gain further buying interest, Mantri said.
"The stock has witnessed a decent rally from 16 levels with a series of higher lows pattern formation on the daily chart, peaking out near the 26.25 zone," Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher, said.
Subsequently, with a short correction, it cooled off from the overheated zone. The stock has taken support near the 50-EMA level of the 22.60 zone and indicated a breakout above the previous peak of 26.25 zone with a series of bullish candle formations to improve the bias once again. With a higher low pattern formed once again, the bias has improved, he said.
"We expect the stock to rise to the initial target of 32, and thereafter, with sustaining strength, it can achieve the next targets of 35 and 44 levels, respectively. The near-term support would be maintained near the 22.60 zone," Koothupalakkal said.
Derivative trader Rajesh Srivastava is also bullish on Yes Bank with a target price of Rs 45. "The business is going through major restructuring, with significant decisions like the transfer of Yes Securities business, which shall drive upside momentum going forward."
What has led the rally up
This week, the RBI approved HDFC Bank's acquisition of up to 9.50 percent of the paid-up share capital or voting rights of Yes Bank. The approval is for a period of one year.
On January 27, Yes Bank announced that its board approved the transfer of investment banking and merchant banking businesses from Yes Securities (India) Limited (YSIL), its wholly-owned subsidiary, to the bank.
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