Despite their protestations to the contrary there is not much difference between the stock market darlings Kotak and the wannabes that have grown in individual hypergrowth cycles like YES, ING, J&K BANK and even the older groups like FEDERAL BANK, the just acquired Bank of Rajasthan and the Hinduja owned Indus ind Bank.

 

 

As you can see, despite the higher market capitalization of Kotak Bank and the predatory sale by Rabo Bank making way for its own NBFC set up in India, YES is pretty much in the same league without the 1500 odd private clients of Kotak and its myriad local short cuts that have got it in trouble in Gujarat ( IPO &  Kotak securities accounts) Mumbai and other local markets.

 

On the other hand YES held up pretty well to longstanding Rabobank plans to piggyback on it to learn and enter the Indian market much like Nissan’s failed venture with the local toughie M&M. YES is hardly a member of the Bombay club and has a convenient lifestyle brand positioning in the sector well placed for a prescient hypergrowth cycle that leads the reform process as an ablee member of RBI policy watch if only it can get its lead on the rural portfolio right and support its grandiose plans with quick capital. However as an Indian only Bank it may be alien to homegrown PSB cultures in mid town markets and may not compete till it receives the expected 4-5 new investors for the sale of Rabobank stake at $5.8 per share. The capital markets however are unlikely to chase them too much for information, interest in the mid cap sector primarily driven by FII and PE interest. Though YES has protested that YES is in the middle of an expansion drive with the new velocity it is doubtful as earlier expansions of the bank have been “highlighting” the impediment of being a mid-cap player with no special niche that can grow up to speed.

 

However the case maybe, we believe in YES!

 

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