​SBI Card IPO: SBI share purchase of Yes Bank not likely to have negative impact, expert says

SBI Card IPO: Technical analyst Nilesh Jain of Anand Rathi Securities does not see any adverse impact on SBI Card IPO, in the event of a share purchase of Yes Bank by the parent company, the State Bank of India.

The listing of SBI Card has not been as per estimates, Nilesh Jain said, adding that it was primarily because of the prevalent market situation. The markets have seen a huge drubbing over the week. The listing of the issue was estimated at around 60 pct while it was subscribed over 26 times on 5 March and this was due to the weekly market conditions, Nilesh Jain.

The fact that SBI Card has been subscribed over 26 times indicates that there is something in it, he added. But if the SBI takes over Yes Bank, its card business will come with the SBI which could eventually benefit SBI Card.

Nilesh Jain said that though, SBI share purchase was still at the stage of proposal any direct link between the SBI card and Yes Bank share purchase could not be ascertained at this point in time.

Shares of SBI were impacted today because of the speculations developing around Yes Bank share purchase by the SBI. SBI shares today closed down by over 6.5 pct from the Thursday close. Jain said that the news of SBI buying Yes Bank shares at Rs 2 apiece is doing the rounds and it was the reason why the stock prices have fallen by over 6 pct on Friday.

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The SBI Cards IPO was launch on Monday. The second-largest card issuer SBI Cards & Payment Services, has hit the primary market with a price band for the share sale at Rs 750-755. The IPO, opening on March 2, comprises fresh issue of equity shares aggregating to Rs 500 crore and an offer for sale where promoters will offload nearly 13 crore shares. Promoters SBI and Carlyle Group will offload 3.73 cr shares and 9.32 cr shares respectively.