After a downward trend in multiple trading sessions since last week, shares of the State Bank of India witnessed a surge of 3.04 percent during the early trading session on Wednesday, June 28.
This positive movement followed the approval given by the Executive Committee of the Central Board (ECCB) of the State Bank of India (SBI) for the bank to acquire the complete 20 percent stake held by SBI Capital Markets (SBICAPS) in SBI Pension Funds.
During Wednesday’s trade, the stock opened at a price of Rs. 558.25 per share against the previous close of Rs. 557.05 per share and soared further to touch an intraday high of Rs. 574 apiece.
At 11:05 a.m., it was trading at Rs. 572.60, up by 2.79 percent on the NSE.
The stock touched a 52-week high of Rs. 629.55 on December 15, 2022 and a 52-week low of Rs. 458 on June 29, 2022, indicating that at the current levels, the stock is trading nearly 25 percent above its 52-week low and 9 percent below its 52-week high.
The stock has declined nearly 4 percent in the past one month. Furthermore, the shares of the bank have dipped over 6 percent this year-to-date. However, it has grown over 120 percent in the last five years.
In a regulatory filing, SBI stated that the acquisition is contingent upon obtaining all necessary regulatory approvals.
At present, SBI holds a majority stake of 60 percent in SBI Pension Funds, while the remaining stake is divided between SBICAPS (20 percent) and SBI Funds Management (20 percent).
"Pursuant to Regulation 30 and other applicable provisions of SEBI (LODR) Regulations, 2015, we advise that the Executive Committee of the Central Board (ECCB) of the bank has accorded approval for acquiring the entire 20 percent stake held by SBI Capital Markets Ltd. in SBI Pension Funds Pvt. Ltd. by State Bank of India, subject to receipt of all regulatory approvals,” the bank said in an official filing.
As of May 31, 2023, SBI Pension Fund, with assets under management (AUM) amounting to approximately ₹3,59,040.81 crores, holds the position of the largest pension fund manager among the 10 entities in India.
With a market share of around 37 percent, it maintains its dominance in the industry. Moreover, within the private sector, SBI Pension Fund manages over 8 percent of the market share of AUM.
State Bank of India (SBI) reported a significant increase in its fourth-quarter profit for the financial year 2022-23 (FY23) compared to the previous year. The bank's Q4 profit witnessed a remarkable surge of 83.18 percent, amounting to ₹16,694.51 crore, as opposed to ₹9,113.53 crore in the corresponding period last year.
In FY23, SBI achieved a net profit exceeding ₹50,000 crore, reaching ₹50,232 crore, demonstrating a notable year-on-year growth of 58.58 percent.
