Govt to sell nearly 2% SUUTI stake in Axis Bank, may get Rs 3,969 cr

Floor price set at Rs 680 a share; govt keeps option open to sell additional 0.74% stake

The government will sell nearly 2 per cent stake in Axis Bank Ltd. held through Specified Undertaking of the Unit Trust of India (SUUTI), a move that’s expected to fetch around Rs 3,969 crore to the exchequer in divestment receipts.

The government will sell its 1.21 per cent stake or 36 million shares in Axis Bank with the floor price set at Rs 680 a share. It has also kept the option to additionally sell its 0.74 per cent or 22 million shares in the private sector lender. In February, Business Standard had reported that the government plans to sell its 1-2 per cent stake in Axis Bank.

The sale of 1.95 per cent stake in India’s third largest private sector bank could help the government mop up around Rs 3,949 crore in divestment receipts. Post the sale, the government would continue to hold a 1.5 per cent stake in Axis Bank through SUUTI.

The offer would open up for non-retail investors on May 19, and such investors would be allowed to indicate their willingness to carry forward their unallocated bids to the next day for allocation from the unsubscribed portion for retail investors. The issue will open for retail investors on May 20.

As markets have not been impacted much by the second wave of the Covid-19 pandemic, the government would continue with its stake sale and privatisation programme, an official said. However, there may be some delays in the privatisation drive as physical mobility has been restricted, he added. The government aims to garner Rs 1.75 trillion in divestment receipts for the ongoing fiscal. It had collected Rs 32,835 crore in divestment receipts as against the revised target of Rs 32,000 crore.