Shares of IndusInd Bank rose 5 percent on Friday after a report said the Hinduja Group is planning to increase its stake in the lender to 26 percent through an investment of ₹10,000 crore. The group currently holds a 15 percent stake in IndusInd Bank.
According to Business Standard, the Hinduja’s Mauritius-based promoter company already has RBI approval to increase the shareholding. The central bank had allowed promoters to own up to 26 percent of a bank in November 2021.
During Friday’s trade, the stock opened at a price of Rs. 1,102.05 per share against the previous close of Rs. 1075.40 per share and grew further during the early trading session to touch an intraday high of Rs. 1,130. It was trading at ₹1,117.20, up by 3.89 percent, at 10:25 a.m. on the BSE.
The stock touched a 52-week high of Rs. 1,275.80 on September 20, 2022 and a 52-week low of Rs. 763.20 on June 23, 2022, indicating that at the current level, the stock is trading over 46 percent above its 52-week low and 12.4 percent below its 52-week high.
The stock has declined over 10 percent in the last one month. However, in the past one year, it has given a positive return of nearly 17 percent. In the last five years, the stock has yielded a negative return of 32 percent.
CNBC-TV18 earlier reported IndusInd International Holdings Limited, the promoter of IndusInd Bank, was in the process of submitting an application to the RBI to increase its stake in the private sector lender.
According to the ownership distribution revealed to exchanges as of December 2022, Hinduja Group possessed a 16.51 percent investment and 15.16 percent voting shares in IndusInd Bank through IndusInd International Holdings Limited (IIHL).
Promoter ownership of the paid-up share capital or voting rights of the banking company may reach up to 26 percent after 15 years from the start of the banking company's operations.
The private sector lender on January 18 reported a 58 percent jump in its December quarter net profit at ₹1,964 crores, driven by improvements in asset quality and core income.
The bank's net interest income grew 18 percent to ₹4,495 crore, driven by a 19 percent loan growth and a 0.17 percent widening in the net interest margin to 4.27 percent.
IndusInd Bank Ltd has a market capitalization of ₹83,426.90 crore. It offers commercial, transactional and electronic banking products and services.
According to a Mintgenie poll, 43 analysts on an average have a ‘BUY’ call on the stock.