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omshivaya
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   Posted: 29/Nov/2006 at 7:25pm |
Originally posted by basant
Under all the options I fear that it would dilute equity and if it does that it could become a ICICI bank where the bank grows but investors do not earn that much since EPS grows at a lower rate. Broadly the sounds are bullish no doubt but we should be open to these aspects also.As I maintain no company can grow at a rate higher then RoE for a long period of time. |
But if ICICI was where Yes Bank is now, hasnt it delivered wealth for its early shareholders, despite diluting equity? Or did ICICI Bank start diluting equity only a few years back and not since it was very very small like Yes Bank? Just curious!
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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
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basant
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Posted: 29/Nov/2006 at 7:44pm |
The stock has been a 20 bagger but the bank has grown far more then that over the past 10 years.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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omshivaya
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Posted: 29/Nov/2006 at 8:17pm |
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What do you think would be the ideal choice: a kind of balancing act between "creating shareholder wealth" and "accumulating capital for growing the company". There must be a better way than to just go for option 1.
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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
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basant
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Posted: 29/Nov/2006 at 8:37pm |
The best choice is to use the capital efficiently - Increase RoE . The biggest multibaggers have high RoE whether it is Infosys, Wipro, Hdfc bank, Pantaloon etc.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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omshivaya
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Posted: 29/Nov/2006 at 8:55pm |
Yes Bank ranked 1st on Efficiency.
If they try, how much do you think the management is capable of doing it?
Their promoter background (if it helps):
Key Management background(Interesting names here):
Key Management:
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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
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basant
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Posted: 29/Nov/2006 at 10:18pm |
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Yes Bank is young I am not being judgemental on this but we as investors need to be aware that a big gap between RoE and growth rate cannot be maintained for long without diluting equity.
Edited by basant - 29/Nov/2006 at 10:19pm
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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omshivaya
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Posted: 29/Nov/2006 at 8:11am |
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Thanks Basant ji. There is a word called "conviction". I have conviction on "Nucleus software" and I want to have the same thing for Yes Bank. Let's see if Yes Bank can reach that stage for me.For now, I am cautiously bullish as someone said, but I dont have conviction on Yes Bank. I am hoping one day I shall.
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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
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xbox
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Posted: 06/Dec/2006 at 7:20am |
"Yes Bank launches microfinance
Indian private sector lender Yes Bank Ltd on Wednesday launched a microfinance unit in a technical tie-up with Boston-based Accion International, and said it would spin off the unit once it reached critical mass"
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These are one of many steps which distringush YES Bank from rest of the pack. Microfinance is not only high margin business but also it will take care of priority lending. This is good innovation.
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Don't bet on pig after all bull & bear in circle.
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