IDBI Bank Share Price Picks Up Steam; Gains 6% After RBI Nods For Moving Forward In Privatisation

The Reserve Bank of India (RBI) released a "fit and proper" report on bidders today, July 18, which accelerated the divestment process and caused shares of IDBI Bank to rise by nearly 6 per cent to Rs 93 per share.

By evaluating bidders, the central bank makes sure they meet the requirements for "fit and proper" status and follow the rules in order to move on to the next phase of the privatization process.

Shareholding Pattern

LIC holding a majority stake of more than 49 per cent in IDBI Bank, the central government owns 45.5 per cent of the bank. The plan calls for selling 60.7 per cent of the bank, which includes the 30.5 per cent stake held by the government and the 30.2 per cent held by LIC.

Eligibility for bidders

In order to be eligible to bid for IDBI Bank, a bidder must report net profits in three of the previous five years and have a minimum net worth of Rs 22,500 crore. Up to four people may participate in a bidding consortium, and the winning bidder must commit to securing at least 40 per cent of the equity capital over a five-year period.

The government will provide eligible bidders with access to private IDBI Bank information, such as employee pension funds and information about insurance or medical coverage, after the RBI has finished the screening process.

IDBI bank Q1 FY25

IDBI Bank reported a 13 per cent YoY increase in total deposits to Rs 2.7 lakh crore in its Q1 FY25 business update, up from Rs 2.4 lakh crore in the same period last year. Additionally, net advances increased YoY by 17 per cent, from Rs 1.65 lakh crore in Q1 FY24 to Rs 1.9 lakh crore in Q1 FY25.

Share performance

This state-owned lender's stock has increased by more than 33 percent so far this year, compared to the benchmark Nifty 50's 12 percent gain. Prior to this, on February 6, 2024, IDBI Bank hit a 52-week high of Rs 98 per share.

Today, IDBI's share price was up by 4.55 per cent, hovering around Rs 91.88 per share on the Indian bourses.