IDBI Bank share price rises 4% on divestment proposal talk
The Union Cabinet may consider a proposal to divest the government's 45.5 percent stake in the bank, a media report has said.
April 13, 2021 / 09:49 AM IST
IDBI Bank share price rose 4 percent in the early trade on April 13 following reports that the Union Cabinet may consider a proposal to divest the government's 45.5 percent stake in the bank.
The cabinet approval will give the Department of Investment and Public Asset Management (DIPAM) the authority to move ahead with the divestment process, Business Standard has reported.
The government will also consult LIC, which owns 49.2 percent of IDBI Bank, before beginning the stake sale process, the report said.
"DIPAM cannot move forward with the divestment process until approval from the cabinet is received, given that banks come under work allocation of the DFS. After the cabinet's approval, intermediaries can be appointed," an official told Business Standard.
The government's plan to sell its holding in the lender was delayed due to the COVID-19 pandemic, the report said.
On March 10, the Reserve Bank of India (RBI) removed the LIC-controlled bank from its prompt corrective action (PCA) framework.
Presenting the Budget on February 1, Finance Minister Nirmala Sitharaman proposed to take up the privatisation of two state-run banks along with IDBI Bank in FY22.
At 0930 hours, IDBI Bank was quoting at Rs 34.90, up Rs 1.10, or 3.25 percent, on the BSE.
The share touched a 52-week high of Rs 55.75 on July 7, 2020 and a 52-week low of Rs 19.20 on May 19, 2020. It is trading 37.4 percent below its 52-week high and 81.77 percent above its 52-week low.