Corporation Bank gains as LIC proposes to acquire additional shares through preferential issue

Corporation Bank rose 2.14% to Rs 47.80 at 12:21 IST on BSE after the bank said Life Insurance Corporation of India has expressed its intention to infuse Rs 143 crore into the bank.

Shares of Corporation Bank had risen 2.41% to Rs 46.80 yesterday, 14 September 2015, after the announcement was made at the fag end of trading session.

Meanwhile, the BSE Sensex was down 123.60 points, or 0.48%, to 25733.10.

On BSE, so far 65,000 shares were traded in the counter, compared with an average volume of 40,502 shares in the past one quarter.

The stock hit a high of Rs 48.70 and a low of Rs 47.65 so far during the day. The stock hit a 52-week high of Rs 78.90 on 22 January 2015. The stock hit a 52-week low of Rs 43.60 on 7 September 2015.

The stock had underperformed the market over the past one month till 14 September 2015, falling 8.86% compared with 7.88% fall in the Sensex. The scrip had also underperformed the market in past one quarter, sliding 7.60% as against Sensex's 2.15% decline.

The state-run bank has an equity capital of Rs 167.54 crore. Face value per share is Rs 2.

Corporation Bank announced that subsequent to the decision of the Government of India to infuse upto Rs 857 crore in the bank, the bank has received a proposal from Life insurance Corporation of India (LIC) expressing its intention to infuse Rs 143 crore into the capital funds of the bank by way of issue of equity shares on preferential basis to LIC.

Corporation Bank is seeking shareholders' approval for allotting upto 2.81 crore equity shares at Rs 50.78 each aggregating to Rs 143 crore on preferential basis to LIC. Currently, the Government of India (GoI) owns 63.33% stake while LIC owns 22.54% stake in Corporation Bank. After the proposed preferential allotment, the GoI's stake in Corporation Bank will increase to 67.20% and LIC's stake will decline to 21.22%.

Corporation Bank's net profit fell 11.8% to Rs 204.26 crore on 2.3% increase in total income to Rs 5334.60 crore in Q1 June 2015 over Q1 June 2014.

Powered by Capital Market - Live News