Japanese Bank Backs YES Bank
- 06th May 2025
Aaj Ka Bazaar
The Wall Street indices closed lower after U.S. President Donald Trump’s announced of a 100% tariff on movies produced outside the U.S. In the Asia Pacific markets, Japan and South Korea were closed for public holidays, while China returned from a day’s holiday. Australia’s S&P/ASX 200 was muted. Gift Nifty trading at 24,580 signals a downward opening for the Indian market benchmark indices. As the day proceeds, Ather Energy, an e-scooter maker’s IPO, is set to list on the stock market today. In the stock-specific news, Glenmark Pharmaceuticals will remain in focus as the company has received U.S. FDA approval for a blood cancer drug. Investors await the U.S. Federal Reserve’s policy announcement, in which the central bank is largely expected to keep interest rates unchanged. Also, their radar will be on India’s and China’s Services PMI Final data for April, scheduled for release today.
Markets Around Us
BSE Sensex – 80,595.40 (-0.25%)
Nifty 50 – 24,393.10 (-0.28%)
Bank Nifty – 54,648.25 (-0.50%)
Dow Jones – 41,173.43 (-0.11%)
Nasdaq – 17,844.24 (-0.74%)
FTSE – 8,596.35 (1.16%)
Nikkei 225 – 36,830.69 (0.00%)
Hang Seng – 22,658.98 (0.68%)
Sector: Banking
Yes Bank Soars 9%
YES Bank shares jumped over 9% on May 6 after reports said Japan’s Sumitomo Mitsui Banking Corp (SMBC) got approval from the Reserve Bank of India (RBI) to buy a 51% stake in the bank. The deal is expected to value YES Bank at around $1.7 billion. SMBC may either acquire up to 26% first triggering an open offer or take a smaller stake initially, followed by a merger through a share swap. This potential deal offers an exit opportunity for State Bank of India and other banks that rescued YES Bank during its 2020 crisis. Big banks like Axis Bank, HDFC Bank, and Kotak Mahindra Bank are expected to start selling their shares to SMBC in phases. The deal also includes certain voting rights and control assurances for SMBC. Last year, talks with other Japanese banks didn’t work out as they wanted more relaxed voting rights.
Why it Matters:
This deal matters because it brings fresh foreign investment and marks a major milestone in YES Bank’s recovery journey. It also allows key Indian banks like SBI and HDFC to gradually exit their crisis-time holdings. With SMBC set to take control, the bank’s future strategy and market position could see a strong shift.
NIFTY 50 GAINERS
M&M – 3101.50 (2.65%)
HEROMOTOCO – 3851.90 (2.24%)
EICHERMOT– 5576.00 (2.12%)
NIFTY 50 LOSERS
CIPLA – 1507.20 (-2.31%)
JIOFIN – 254.60 (-2.30%)
BAJFINANCE – 8756.00 (-1.97)
Sector : Tea & Coffee
CCL Products Surge on Strong Q4 Earnings
Shares of CCL Products surged over 15% to ₹684 on May 6 after the company reported strong results for the January-March quarter of FY25. Its net profit jumped 56.35% year-on-year to ₹101.9 crore, driven by higher demand, better operational efficiency, and increased export volumes. Revenue from operations rose 15% to ₹836 crore, supported by strong performance from its expanded Vietnam facility. EBITDA grew 38.3% to ₹163.3 crore, with margins improving to 19.5% from 16.3%, thanks to better cost control and increased sales of premium products. Despite the recent rally, CCL’s stock is still down over 18% for the year, while the Nifty 50 is up by 3%. CCL Products is a leading private-label instant coffee manufacturer, supplying brands in 90 countries, with over 90% of its revenue coming from exports to Europe, North America, and Asia. The company operates four manufacturing plants in India, Vietnam, and Switzerland.
Why it Matters:
This matters because CCL Products delivered a strong earnings rebound despite a weak stock performance this year. Rising profits, improved margins, and strong export demand signal operational strength and global market resilience. It positions the company well for future growth in the premium coffee segment.
Around the World
Asian currencies mostly weakened on Tuesday as the US dollar held steady, with markets watching for updates on US-China trade talks and an upcoming Federal Reserve meeting. Trading volumes were low due to holidays in Japan and South Korea, while Chinese markets reopened after their Labor Day break. The Chinese yuan jumped to a six-week high on hopes of progress in trade discussions. Meanwhile, the Taiwan dollar dropped sharply, making it Asia’s weakest performer, while the Indian rupee, Singapore dollar, and South Korean won saw modest losses against the US dollar. The Australian dollar slipped after strong gains last week. The US dollar held recent gains but remained down over the past three months, weighed by concerns over the US economy and ongoing policy uncertainty. Investors are now focusing on the Federal Reserve’s meeting, where interest rates are expected to remain unchanged amid weak economic signals and persistent inflation
Option Traders Corner
Max Pain
Nifty 50 – 24400
Bank Nifty – 54700
Nifty 50 – 24462 (Pivot)
Support – 24,399, 24,336, 24,273
Resistance – 24,524, 24,588, 24,650
Bank Nifty – 55017 (Pivot)
Support – 54,688, 54,458, 54,129
Resistance – 55,247, 55,576, 55,806
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