INSUBCONTINENT EXCLUSIVE:
Bakshi, a value investor and professor of finance at Management Development Institute (MDI) Gurgaon.
Shares of IDBI Bank traded 1.19 per
cent lower at Rs 58.35 on BSE at 2.34 pm on Monday.
"LIC does not have the skills to run a bank
Whether it will be able to provide the right leadership or guidance is something that needs to be questioned
There are other issues too, such as cap on the voting by shareholders
The government can exercise its vote, but LIC certainly cannot," said Amit Tandon, founder MD, IIAS.
The PSU insurer already owns 10.82 per
cent stake in the state-run lender and would require regulatory clearance to increase it beyond 15 per cent
The insurer is said be weighing acquisition of a 43 per cent stake in the lender, ETNow quoted sources as saying.
Neeraj Dewan, Director at
Quantum Securities, believes the love looked like a desperate measure, but the timing of the decision may not be that bad
"You may have the capex cycle picking up slowly
When we go across corporates, they are in need of money
You saw that for Tata Steel, which has been able to get Bhushan Steel
Last month, RBI brought the bank under its prompt corrective action (PCA) framework due to high non-performing assets (NPAs) and negative
return on assets (RoAs).
IDBI Bank reported a Rs 5,662.76 crore loss for March quarter, compared with Rs 3,199.77 crore loss reported for
the corresponding quarter last year
Net interest income (NII) fell 44 per cent YoY for the quarter to Rs 915.47 from Rs 1,633.29 crore in the same quarter last year.
ET had
reported earlier this month that the government was considering a preferential capital issue by IDBI Bank to bring its holding below 50 per
cent as part of plans to transform its fortunes on the lines of Axis Bank.
