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Central Bank shares dive 17% in 3 sessions to hit 52-week low; here's why

Central Bank shares dive 17% in 3 sessions to hit 52-week low; here's why

Central Bank share price: The stock tumbled 11.89 per cent to hit a one-year low of Rs 36.46. At this price, it has corrected 17.02 per cent in three trading days.

Prashun Talukdar
Prashun Talukdar
  • Updated Apr 2, 2025 12:56 PM IST
Central Bank shares dive 17% in 3 sessions to hit 52-week low; here's whyCentral Bank share price: Immediate support on the counter could be seen in the Rs 34-35 zone.

Shares of Central Bank of India continued to plunge for the third consecutive session on Wednesday. The stock tumbled 11.89 per cent to hit a one-year low of Rs 36.46. At this price, it has corrected 17.02 per cent in three trading days.

The PSU lender informed bourses last week about the closure of its Qualified Institutional Placement (QIP). It issued a majority of shares to Life Insurance Corporation of India (15.88 per cent) and National Pension System (NPS) Trust (10.99 per cent).

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"We wish to inform you that the Capital Raising Committee of Board at its meeting held, i.e. 28.03.2025, approved the issue and allotment of 37,04,61,842 Equity Shares, to eligible QIBs at the issue price of Rs 40.49 per Equity Share which includes a discount of Rs 2.13 i.e., 4.99 per cent of the floor price, as determined in terms of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018), aggregating to Rs 1,500 crore (Rupees One Thousand Five Hundred Crores Only), pursuant to the QIP," Central Bank stated in a BSE filing.

"The recent QIP was discounted to the market value. Also, the PSU stocks are currently in a consolidation phase and the QIP came at a time when the market is going through a turbulent phase. The QIP discount reflected on valuation of equity and that is the reason why we are seeing a negative reaction on the counter," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.

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Technically, immediate support on the counter could be seen in the Rs 34-35 zone.

"Central Bank experienced a significant decline, breaking below its historical support level of the Rs 42-41 range. The next potential support is expected to be around the Rs 34-35 zone, which may help cushion the ongoing decline in the stock. On the upside, the previous support zone of Rs 41-42 is now anticipated to act as a resistance in the near term," said Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One.

"The stock has broken its long-term support with a breakaway gap, indicating negative sentiment. It is forming a lower low and lower high pattern, reinforcing the downtrend. The scrip is expected to correct towards Rs 31, followed by Rs 26. However, if the price sustains above Rs 43, the outlook will shift," said Kunal Kamble, Senior Technical Research Analyst at Bonanza Group.

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As of March 28, 2025, the government held an 89.27 per cent stake in the state-owned lender.

Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
Published on: Apr 2, 2025 12:56 PM IST
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