RBL Bank shares drop 2% after lender denies report on Dubai-based Emirates NBD Bank eying minority stake

RBL Bank share price

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26 Aug, 2025 12:21

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The shares of RBL Bank tumbled over 2 percent on July 2 after the lender denied a report claiming that Emirates NBD is looking to acquire a minority stake in the lender. The shares of the bank snapped a four-day gaining streak to trade at Rs 253.87 apiece.

According to The Economic Times, the Dubai government-owned Emirates NBD Bank PJSC was considering the acquisition of a minority stake in RBL Bank, aiming to increase its footprint in Asia. The report cited sources as saying that the investment will be done in the form of a preferential allotment through primary infusion of capital into the Indian private sector lender bank.

RBL Bank soon issued a clarification, denying the report. "The media article that you are referring to is incorrect and speculative in nature. We deny the contents of the article," the lender said.

Notably, RBL Bank is a completely public owned bank, with promoters and promoter groups holding no substantial stake in the lender, as per data on the company' shareholding pattern available on NSE.

The fall in the share price may have also been driven by profit booking at elevated levels. The stock has rallied around 64 percent in the past six months, and nearly 7 percent in the past five days. It currently has a P/E ratio of over 22.

Recently, Citi Research opened a 90-day positive catalyst watch on RBL Bank, expecting an improvement on RoA (Returns on assets) going ahead. The international brokerage reiterated its bullish 'buy' call on the lender, hiking its target price to Rs 285 per share from Rs 230 per share. This indicates an upside potential of over 8.7 percent from the previous closing price.

The brokerage believes that the RoA trajectory can improve to 45-50 basis points, driven by the much-awaited normalization of credit costs. According to the brokerage, accelerated provisioning on joint liability group/credit card segment will help normalise these costs.

Further Citi added that the stress in the joint liability group and credit card portions will subside further in Q1. RBL Bank's slippages are likely to moderate to 4.5 percent, down from 4.7 percent in Q4FY25.

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