Stock of IDBI Bank gained 10 per cent today amid a report that the government was considering selling at least 51 per cent of its stake in the lender. IDBI Bank stock rose 10.09 per cent in the afternoon session to Rs 44.20 against the previous close of Rs 40.15 on BSE.
In a year, the share has gained 15.13 per cent but fallen 5.93 per cent since the beginning of this year. Total 49.92 lakh shares changed hands amounting to turnover of Rs 21.54 crore. Market cap of the lender rose to Rs 46,826 crore on BSE.
ALSO READ: IDBI Bank hikes Retail Term Deposit rates; check new rates here
IDBI Bank shares were trading higher than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages. The stock hit a 52-week low of Rs 30.50 on June 30, 2022 and a 52-week high of Rs 65.25 on October 18, 2021.
The government and state -backed Life Insurance Corp. of India, together own about 94 per cent in IDBI Bank. According to a Bloomberg report, the government officials and LIC are in discussions about how much of their stakes they plan to sell.
Both parties are likely to retain a stake in the lender after the sale. A ministerial group will make the final decision on the structure of the deal, the Bloomberg report said. The government and LIC will formally seek buyer interest at the end of September, the report added.
ALSO READ: Bids for IDBI Bank by month-end likely
While the government owns 45.48 per cent in the bank, LIC owned another 49.24 per cent stake in the lender as of June 30, data has shown.
In the first quarter of this fiscal, IDBI Bank reported a 25 per cent rise in its standalone profit after tax (PAT) to Rs 756 crore for the quarter ended June, led by an improvement in asset quality, better recoveries and lower provisions. The bank reported a profit of Rs 603 crore in the corresponding quarter a year ago. Provisions fell 43% to Rs 1,295 crore from 2,265 crore a year earlier.