Mumbai, March 16: The government’s decision to halt the stake sale process for IDBI Bank led to a significant drop in the bank’s shares on the first trading day of the week, Monday.
As of the time of this report (around 1:52 PM), IDBI Bank’s shares fell by 15.17% to ₹78.20 on the NSE. Initially, the bank’s stock traded at ₹77.56, marking a decline of approximately 15.86% from the previous closing price of ₹92.18. During trading, shares dipped to an intraday low of ₹77.
The government canceled the disinvestment process for IDBI Bank because the received bids did not meet its expectations. Reports indicate that both bids from Fairfax Financial Holdings and Emirates NBD were below the reserve price.
Initially, the government had invited financial bids to sell its stake in IDBI Bank, with expectations of announcing the winning bidder by the end of March. However, it was also believed that the completion of the deal might extend beyond the current fiscal year.
Under the proposed plan, the government aimed to sell its 30.48% stake, estimated to be worth around ₹36,000 crore based on current market prices. Additionally, the Life Insurance Corporation of India (LIC) planned to sell its 30.24% stake, bringing the total stake for sale to 60.72%, with a combined potential value of approximately ₹72,000 crore.
Earlier reports from NDTV Profit suggested that the Iran-Israel conflict had impacted the broader disinvestment process, causing delays in this stake sale. However, sources connected to the matter indicated that the government might cautiously resume the stake sale process in the future.
The disinvestment process for IDBI Bank began on January 7, 2023, when the Department of Investment and Public Asset Management (DIPAM) received several expressions of interest (EOIs) from potential investors.
As of March 16, the total stake held by the government and LIC in IDBI Bank stands at 94.71%, with the government holding 45.48% and LIC holding 49.24%.
My name is Ganpat Singh Choughan. I am an experienced content writer with 7 years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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