IDBI Bank Slumps 5% On Reports Of Govt's Stake Sale Plan

On Thursday, shares of IDBI Bank were locked in a 5 percent lower circuit at Rs 46. A Bloomberg report citing officials said that the government is planning to raise as much as Rs 20,000 crore by selling stake in Coal India and IDBI Bank.

The report said that the proposal to sell shares will take place depending on market sentiment. In the case of Coal India, the company will buy back shares from the government if valuations are not attractive.

In January 2019, Life Insurance Corporation India had acquired a 51 percent controlling stake in IDBI Bank. The government holds 47 percent in the rest.

As for Coal India, the government of India holds 66 percent stake in the company. It has previously sold 10 percent stake in the coal producer in January 2015, gathering Rs 22,550 crore. Shares of Coal India were down nearly 2 percent.

For the current financial year 2020-21, the central government has set a divestment target of Rs 2.1 lakh crore.