IndusInd Bank promoters to buy shares from open market

By: |
March 7, 2020 3:00 AM

Shares of IndusInd Bank fell to a 52-week low of Rs 921.25 during intra-day trading, and closed at Rs 1,014.30 on Friday, down 5.62%, on the BSE.

indusind bankindusind bank, BANKING SECTORFor IndusInd Bank, which was incorporated in 1994, the equity holding cap for promoter holding would be limited to 15%.

Promoters of IndusInd Bank on Friday said they are planning to acquire additional shares from the open market. During the December quarter, promoters held 14.38% stake in IndusInd Bank. IndusInd International Holdings holds 10.59% stake and IndusInd holds 3.79% in the bank. Shares of the private lender have fallen by 24% over the last one month and 34% over the last one year.

IndusInd International Holdings and IndusInd will acquire shares “within the overall prescribed promoter equity holding cap for private sector banks,” the company said. According to the Reserve Bank of India (RBI) guidelines on licensing of private sector banks, promoters and promoter group are mandated to pare their total paid-up voting equity capital to 40% within five years, to 30% within a period of 10 years and to 15% within 15 years from date of commencement of business of the bank. For IndusInd Bank, which was incorporated in 1994, the equity holding cap for promoter holding would be limited to 15%.

Earlier this week, the Hinduja Group-promoted bank had notified the exchanges that its board would meet on March 9 to consider raising funds in the Indian or foreign currency by issuance of debt securities via additional Tier-I capital and Tier-II capital. The bank recently appointed Sumant Kathpalia, who was earlier heading its consumer banking business, as the managing director and CEO for a period of three years.

Last month, Moody’s Investors Services revised the outlook on IndusInd Bank to ‘negative’ from ‘stable’, citing its relatively high exposure to real estate and stating that the bank could be negatively impacted by the stress in the telecom sector.

Shares of IndusInd Bank fell to a 52-week low of Rs 921.25 during intra-day trading, and closed at Rs 1,014.30 on Friday, down 5.62%, on the BSE.

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