Why Kotak Mahindra Bank share price rose 8% today
by BusinessToday.InShare price of Kotak Mahindra Bank rose up to 7.81% to Rs 1,242.55 compared to the previous close of Rs 1,152 on BSE
Kotak Mahindra Bank share price gained in trade today after the private sector lender launched its over Rs 7,000-crore qualified institutional placement (QIP) of shares. Share price of Kotak Mahindra Bank rose up to 7.81% to Rs 1,242.55 compared to the previous close of Rs 1,152 on BSE.
Kotak Mahindra Bank stock is trading higher than 5 day and 20 day moving averages but lower than 50 day, 100 day and 200-day moving averages.
Kotak Mahindra Bank stock has fallen 20.31% in the last one year and lost 27.78% since the beginning of this year. Total 21 of 37 brokerages rate the stock 'buy' or 'outperform', 11 'hold', four 'underperform' and one 'sell', according to analysts' recommendations tracked by Reuters.
The lender's board approved a floor price of Rs 1,147.75 per share for the QIP compared with Tuesday's close of Rs 1,152.45 as per the laid out formula, according to regulatory filings.
Kotak Mahindra Bank gets shareholder nod to issue 6.5 crore equity shares
The share sale through the QIP route will help the bank's promoter group led by Uday Kotak decrease their stake in the bank by 3.4 per cent, and help comply with the Reserve Bank of India''s (RBI) order to have the holding down to 26 per cent by August this year, as against 29.92 per cent as of March.
The bank said it can consider offering a discount of not more than 5 per cent on the floor price so calculated for the issue and the same will be decided by the board's issuance committee on Friday.
After applying the 5 per cent discount, and assuming it sells all the 6.5 crore shares as announced on April 22, the total issue size will come at Rs 7,087 crore.
By Aseem Thapliyal