IndusInd Bank gains after SBI Mutual Fund gets RBI nod to pick up 9.99% in lender

The Reserve Bank of India (RBI) on October 11 issued an approval to SBI Mutual Fund (SBI MF) to acquire 9.99 percent of the paid-up share capital in private lender IndusInd Bank, according to a regulatory filing.

At 9:30am the IndusInd Bank stock was trading 1.23 percent higher at Rs 1440.23 on the NSE.

“The approval has been granted with reference to the application made by SBI MF to RBI,” IndusInd Bank informed the stock exchanges. This acquisition will allow the company to also hold 9.99 percent voting rights in the bank.

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“SBI MF has been advised by the RBI to acquire the major shareholding in the bank within a period of one year i.e. by October 10, 2024,” the exchange filing said.

The the mutual funds arm of the State Bank of India has also been told to ensure that its aggregate holding in the bank “does not exceed 9.99 percent of the paid-up share capital or voting rights”.

Earlier, in May, the RBI gave its nod to SBI Funds Management (SBIFML) – a joint venture between SBI and France’s AMUNDI – to acquire 9.99 percent stake in HDFC Bank and had recommended the company to do so within six months.

IndusInd Bank Quarterly Results

IndusInd Bank had reported strong financials in the first quarter of fiscal year 2023-24, with its net profit rising to Rs 2,124 crore, 32 percent higher as against Rs 1,603.29 crore posted in the June 2022 quarter. The lender’s net interest income grew to 4,867.11 crores, up 17.98 percent as compared to Rs 4,125.20 crore reported in the year-ago period.

In the trading session on October 11, IndusInd Bank’s scrip settled at Rs 1,419 apiece on the BSE, down 1.95 percent as against the previous day’s close.

Stock Performance

The IndusInd Bank stock has given a return of 32.08 percent over the last six months. The benchmark Nifty Bank index has given a return of 7.12 percent over the same duration.

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