Rana Kapoor loses $1 billion as Yes Bank share tanks after dismal Q1 results
BusinessToday.In July 18, 2019
Yes Bank founder and former chief executive officer Rana Kapoor lost more than $1 billion as the bank's share fell to a fresh 52-week low on the Bombay Stock Exchange (BSE) Thursday. The scrip has been on selling spree and tanked over 78 per cent since August last year. Yes Bank shares plunged over 19 per cent to Rs 83.70 apiece in intra-day trade on Thursday after the private lender reported a 91 per cent decline in its net profit for the June quarter of FY20. The weak earnings prompted brokerages including Jefferies and JP Morgan to slash their price targets on the Yes Bank stock.
With the fall in Yes bank share prices, Kapoor's wealth declined to $363 million from $1.4 billion in August 20, as per Bloomberg Billionaires Index.
Kapoor, who built Yes Bank into the fourth-largest private lender over 15 years, was forced to quit by the Reserve Bank of India over bad-debt accounting at the beginning of this year. Ravneet Gill was named CEO after Kapoor's ouster from the bank.
Kapoor reportedly owns 10 per cent of Yes Bank shares through his two holding companies - Yes Capital (India) Pvt Ltd and Morgan Credits. Last year, he said that he will never sell his shares in the bank and will pass them on to his daughters.
"Even after I demit office as MD & CEO of YES BANK, I will never ever sell my @YESBANK shares," Kapoor had said in a series of tweets posted on September 28, 2018. Kapoor had further tweeted: "I will eventually bequeath my @YESBANK Promoter shares to my 3 daughters and subsequently to their children, with a request in my Will stating not to sell a single share, as Diamonds are Forever!!"
In its financial reports for the quarter ended June 30, 2019, Yes Bank reported a net profit of Rs 113.80 crore against Rs 1,260 crore in the same quarter last year, dented by one-off impact from mark-to-market (MTM) provisions of Rs 1,109 crore. The financial results showed that the private lender's bad loan ratio had increased and its capital buffers had weakened.
Meanwhile, the Yes Bank stocked closed 12.85 per cent lower at Rs 85.8 on the BSE on Thursday.