Axis Bank stock climbs 2% as lender buys Citibank's India consumer business

Axis Bank shares rose nearly 2 per cent today amid reports that the private sector lender acquired Citigroup's retail banking business in India. Axis Bank stock touched an intraday high of Rs 763.90, gaining 1.82 per cent on BSE. The large cap stock is trading higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. Total 2.47 lakh shares of the firm changed hands amounting to a turnover of Rs 18.68 crore on BSE.

Market cap of the bank rose to Rs 2.33 lakh crore on BSE today. Axis Bank stock has gained 9 per cent in one year and risen 12.05 per cent since the beginning of this year.

The deal, to be valued at $2.5 billion (about Rs 18,000 crore), will be subject to regulatory approvals.

Analysis: Here's how Axis Bank will gain from acquisition of Citibank's consumer biz

In April 2021, American banking major Citigroup announced its plan to exit from the consumer banking business in India as part of its global strategy.

The business comprises credit cards, retail banking, home loans and wealth management. The bank has 35 branches in the country and employs about 4,000 people in the consumer banking business.

Once the deal gets the approvals, the sources said the balance sheet size of Axis Bank will expand and the retail segment will witness a significant jump.

Citigroup had entered India in 1902 and started the consumer banking business in 1985.

Share Market LIVE: Sensex rises 100 pts, Nifty crosses 17,500; Axis Bank, Asian Paints, M&M top gainers

YES Securities maintained a buy rating on the Axis Bank share with a revised target price of Rs 1,060.

"Integration of Citi's business will be a key monitorable but importantly, there is some downside protection built into the deal for Axis Bank. We think that the deal will be RoE accretive in FY24E and raise our FY24E PAT estimate by 3.5 per cent. We reiterate BUY rating on AXSB with a revised price target of Rs 1060," the brokerage said.