IDBI Bank shares fall 7% as investors book profit after Fairfax deal gets cabinet nod
IDBI Bank pursued an acquisition.
· ET Stocks, Economic Times Markets
IDBI Bank shares plunged as investors booked profits after a nearly 13% rally in the previous session following the Cabinet’s approval of Fairfax’s acquisition of a 60.72% stake in the lender. The stock had hit Rs 93.60 on Wednesday, lifting its market capitalisation above Rs 1 lakh crore.
The analysis
IDBI Bank reported Rs 93.60, Rs 1 lakh crore and Rs 52,878 crore, with movement of 7%, 13% and 60.72% attached to those lines. Those are the figures as filed — what moves the price is how they sit against what the market already expected, not their absolute size.
Against that, the stock is -7.2% on the day at ₹83.87, and has returned -2.8% over three months. It sits 28% below its 52-week high, which means a good deal of bad news was already in the price. The banks sector has moved -3.5% over the same period, so IDBI Bank is running 0.7 points ahead of its peers.
For IDBI Bank, the question is how much of this is already reflected in the price and how much re-rates the banks peer set alongside it.
Market context
- The company directly in focus is IDBI.
- Sector exposure: Banks.
- The immediate tone of coverage reads negative.
In this story
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