One of the biggest Bank of Indian Economy is under Bear attack, due to some management issues and some regulatory issues, overall if you are looking for the big-time frame at least 3-4 years then we can say the price is near about bottom.
These kinds of Bad news will keep building selling pressure in the market. For short term, everyone is in a panic because no one can imagine a big bank sliding down 30-45% in last3 months, In past that happened with Yes Bank twice, In 2009 and In 2013. We agree that in 2009 there was a Financial crash in the global market but in 2013 that crash happened only in the market that time Yes bank fell down 60% that was because of the crisis of Indian Rupee. Same as past we are near about bottom levels because it is down by 55% from High of 380 levels. But see we can only learn from past information, for acting on it, we have to review our present regularly. If it breaks 150 then 125 will be next support.
Either wait for these levels or wait for Jan-mar for some more lower levels because the fall from 330 to 240 was very big and was very strong, heavy selling volume was there, so it will be very hard for yes bank to go back to 250-300 levels in short-term, so wait for levels or wait for Jan-Mar 2019. Don’t try to buy in bulk, always do that in parts.
In long-term, these kinds of companies will make you rich but your patience requires in all these kind of investment. Just check charts of last one decade, two times it went down 60-75% and after that, for the next 3-5 years it gave a return of minimum 4x.
As per weekly charts, we are getting 3 supports levels
- Rs 150-160
- Rs 120-125
- Rs 100-107
See these values we get by searching demand-supply zones of long-term charts.
What is Demand-supply? That means finding out the maximum number of previous support and resistance in long-term charts. Then you will get some range of buying-selling.
Overall we don’t know where it will take support in long-term but we have to make sure we have perfect values in our hand for averaging this stock.
How to play this Demand-supply zone? Here you have to wait for either reversals or Breakdown, In market only these two things will be there, the market can’t trade in one price range it has to move above or below that range. So If you are here for long-term Investment then you have to pick it up in parts.
First Buy in range of 150-160, if the market breaks this range then it will try to touch 125, there you have to buy some more and so on till it touches last support which is at 107 and that level is screaming buy, because as per company fundamentals that price will act as gem price.
Allocate 30% at a range of 150-160 like if you planning to add Yes bank worth of 10k in your portfolio then do like this,
- Range of 150-160 = 35% Investment of Rs 3500 out of 10k.
- Range of 120-125 = 40% Investment of Rs 4000 out of 10k.
- Range of 100-107 = 25% Investment of Rs2500 out of 10k.
Disclaimer: This is for Investment purpose only not for short-term trading.
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9 Comments
any take on ib ventures, ibhousing, dhfl and pnb ..
IB venture avoid manipulation going on, Ibulhousing long good, DHFL going through bad phase, PNB Avoid fully, Avoid PSU at all cost.
Hello Divish,
First of all, congratulations on your new website. Your path o becoming best fund manager in India is in right path 🙂
With regards to Yes Bank, thanks fir the detailed analysis. I wwant to add few things like
1. If we see Yes Bank without Rana Kapoor, its still a great organisation
2. In India, I don’t see investors/govt will allow big bank to fall
3. It can be good acquisition candidate for big boys like Kotak
4. If Yes Bank gets able CEO & MD, its matter 4-6 quaters to bring back to normalcy
5. If all NPA is out(still I don’t think so, once new CEO comes everything will get clear), its big buy
I started my purchase in parts from 200 levels. I am doing 10% buy in each fall. Lets see if it goes still lower.
I remember Big Uncle of investment Mr. Buffett saying “Buy when everyone is fearful, Sell when everyone is greedy”
Thanks for your kind words, sir 🙂
Yes bank is a private organization and they have good management team, Rana Kapoor will be there and will work from behind even if RBI rules him out, He will try to guide each time whenever company need him, See it will take at least 2-3 quarter to settle all these things, Still some NPA mismatch will be there, that will be only be solved when a new guy will come in the company. Be stick to quality it will pay you back definitely in upcoming years.
Hi Divish, congratulations for your new website. Your detailed analysis are really helpful. I am thankful for all your guidance. This common platform will help all of us to learn & grow
All the best !
Thanks 🙂 More improvement will be there soon.
Congratulations!!
All the best !
Thanks 🙂
Thanks 👍