Market

IDBI Bank share price surges 15% on Cabinet’s in-principle nod to strategic divestment

According to an analyst, the Cabinet approval for IDBI Bank’s divestment is a positive step as the private or foreign entity could infuse better management, technologies and new funds

IDBI Bank share price surged 15 per cent to Rs 43.50 apiece in intraday on BSE on Thursday, after the Cabinet Committee on Economic Affairs gave its in-principle approval for strategic disinvestment along with transfer of management control in IDBI Bank. On the back of heavy volumes, IDBI Bank stock was trading 8 per cent higher at Rs 40.90 apiece in late morning deals. Round 76.04 shares of IDBI Bank exchanged hands on BSE, while a total of 8.3 crore IDBI Bank stocks have traded on NSE so far in the session.

According to an analyst, the Cabinet approval for IDBI Bank’s divestment is a positive step as the private or foreign entity could infuse better management, technologies and new funds which could thereby boost the Bank’s prospects. “Technically, 42-48 levels should be used by investors to exit or book profit and re-enter only near 36 levels for higher profits,” AR Ramachandran, Co-founder & Trainer, Tips2Trades, told Financial Express Online.

The extent of respective shareholding to be divested by government and LIC shall be decided at the time of structuring of transaction in consultation with the Reserve Bank of India, IDBI Bank said in an exchange filing. The central government and LIC together own 94.72 per cent of the equity of IDBI Bank (Government 45.48 per cent, LIC 49.24%). LIC is currently the promoter of IDBI Bank with management control and GoI is the co-promoter.

So far in intraday, IDBI Bank share price has touched an intraday high of Rs 43.50 apiece and an intraday low of Rs 40.15 apiece on BSE. In comparison, S&P BSE Sensex was trading volatile at around 48,670 levels. LIC’s Board has also passed a resolution to the effect that LIC may reduce its shareholding in IDBI Bank through divesting its stake along with strategic stake sale envisaged by the government with the intent to relinquish management control and by taking into consideration price, market outlook, statutory stipulation and interest of policyholders. This decision of LIC’s Board is also consistent with the regulatory mandate to it to reduce its stake in the Bank.

However, the All India Bank Employees Association (AIBEA) has opposed the government’s move to privatise IDBI Bank. The association said the government should control a minimum of 51 per cent share capital of the bank.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

IDBI Bank share price surges 15% on Cabinet’s in-principle nod to strategic divestmentFinancial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.



Most Related Links :
usnewsmail Governmental News Finance News

Source link

Back to top button