Bank stocks in intra-day trade were on a rallying spree with some of the names such as SBI, PNB, Canara Bank surging upto 7%. Even private sector lenders including ICICI Bank and HDFC Bank recorded hike in market price. Corporation Bank surged as much as 12% in intra-day trade.
The gains in the banking index and stocks come as the Supreme Court has overruled NCLT order in the Essar Steel insolvency case that operational creditors be treated at par with financial creditors.
Soon after the pronouncement of the verdict, the SBI with heavy exposure to Essar Steel rallied a much as 5%. Also, ICICI Bank with an exposure of more than Rs. 2500 crore, surged 2% in trade today.
Other banking stocks that gained after the verdict are stocks such as Bank of India and IDBI.
Earlier, the CoC had filed a case against the ruling of NCLAT which stated that should recover more than operation creditors in the bankruptcy resolution process.
After the verdict, Arcelor Mittal may acquire the bankrupt company.