Yes Bank Drops Over 6% After Picking Up 9.47% Stake in Eveready

Source: news18.com

Yes Bank Ltd shares dropped over 6% in early trade on Friday after the lender informed the exchanges that it has acquired 9.47% stake in Eveready Industries by invoking pledged shares.

Yes Bank stock fell as much as 6.2% to Rs 90.20 in intraday trade on Friday. Meanwhile, Eveready Industries shares jumped over 3% in early trade.

Yes Bank acquired around 6.9 million shares of Eveready Industries on the invocation of pledge after McLeod Russel defaulted on its loan. Eveready Industries and Mcleod Russel India are both part of B M Khaitan Group companies. Shares of McLeod Russel also fell 5% on Friday.

“Shares have been acquired pursuant to invocation of pledge of shares of Eveready Industries India Ltd subsequent to default/breach of terms of credit facilities sanctioned by Yes Bank to McLeod Russel India Ltd which is a group company of BM Khaitan Group,” Yes Bank said.

In a recent development, Price Waterhouse and Co Chartered Accountants LLP (PwC) quit as Eveready Industries’ auditor, saying it was unable to obtain sufficient audit evidence of inter-company deposits and its recovery.

Yes Bank shares have dropped over 70% in the last one year compared with a 12% rise in the benchmark Nifty 50 index. The stock has been under tremendous pressure due to a series of downgrades and fears of further slippage in asset quality.

Yes Bank recently underwent a massive balance sheet clean-up task under new chief executive Ravneet Gill. It posted a whopping Rs 1,506 crore net loss during the March quarter as provisions soared over nine times.

Gill, however, assured investors last month that the worst is over for the bank and there are unlikely to be any further nasty surprises due to higher bad loans or slippages from its watchlist.