Axis Bank rose almost 3% after receiving IRDAI nod for the M&A deal:
Axis Bank: It is one of the largest private sector banks in India located in Mumbai, Maharashtra. The bank provides services in Banking and Financials across India. It sells financial services to large, mid-size companies, SMEs, and retail businesses. Initially, the bank was also known as UTI Bank. The bank formed as a joint venture between Unit Trust India (UTI), LIC, General Insurance Corporation, and The New India Assurance Company. On July 30th, 2007, the UTI Bank’s name changed to Axis Bank. The present Managing Director & Chief Executive Officer (CEO) of the company is Amitabh Chaudhry.
Meanwhile, on Thursday, February 25th, the shares of the private bank surged almost 3% in the stock market. The main reason for this is the bank received approval from the Insurance Regulatory and Development Authority of India (IRDAI) for the acquisition of 12% stakes in Max Life Insurance.
Moreover, the stakes of the insurance company will be acquired by Axis Bank and its subsidiaries. Whereas it is a long-awaited approval from IRDAI, which was announced in April 2020.
Now the Axis Bank subsidiaries have the right to acquire almost 12% stakes in Max Life. In that, Axis Bank will acquire almost 9% stakes and Axis Capital Limited and Axis Securities Limited together will acquire almost 3% stakes in Max Life in one transaction.
On the other side, the Axis Bank subsidiaries have the right to acquire an additional 7% stake in Max Life in one or more transactions in the next few years, said Max Financials to Exchange filing.
Analjit Singh, Chairman of Max Group and Max Financial Services said the joint-venture will strengthen their position as a top leader in the Indian life insurance sector which is showing clear indications of rapid and enduring growth.
Previously, the bank decided to acquire 29% stakes in Max Life but advice from RBI decides to acquire only 19% stakes in Max Life.
After the approvals from IRDAI, the global research firm CLSA maintained a buy call with a target price of Rs. 1,225 per equity share. The deal with Axis Bank will help structural reforms in the company. Besides, Jefferies maintained a buy call with a target price of Rs. 1,000 per equity share.
However, the shares of Axis Bank Limited reported a bullish trend in the stock market on Thursday. It gained 19.60 points with a 2.62% increase and reached 769.00 INR. While in BSE, the bank gained 22.05 points with a 2.94% increase and reached 770.80 INR.
While the shares of Max Financial Services Limited reported a bullish trend in the stock market on Thursday. It gained 36.50 points with a 4.28% increase and reached 889.20 INR. While in BSE, the company gained 35.80 points with a 4.20% increase and reached 889.15 INR.
Stock Market on February 25th:
On Thursday, both Sensex and Nifty continue their bullish trend in the stock market from the last two sessions of the market. The Sensex is trading above 51,000 levels and nifty trading above 15,000 levels in the stock market. The Sensex gained 257.62 points with a 0.51% increase and reached 51,039.31 levels. While the nifty gained 115.35 points with a 0.77% increase and reached 15,097.35 levels.
On the other side, the number of coronavirus cases in India on Thursday, February 25th reached 1,10,46,914 with almost 1,56,705 deaths.
In the border markets, the S&P BSE SmallCap index reported a bullish trend in the stock market on Thursday. It gained 285.01 points with a 1.42% increase and reached 20,304.98 levels. Whereas, the S&P BSE MidCap gained 219.95 points with a 1.09% increase and reached a 20,333.80 level. While the Nifty Bank gained 96.70 points with a 0.27% increase and reached 36,549.00 level.
Top Gainers on February 25th: Coal India, UPL, Adani Ports, BPCL, and Hindalco Industries are the top gainers in today’s stock market.
Top Losers on February 25th: ICICI Bank, Nestle India, Titan Company, Larsen & Toubro, and Kotak Mahindra Bank are the top losers in today’s stock market.