IDBI Bank stock shrugs off reduction in lending rates

IDBI Bank rose 2.46% to Rs 77.10 at 09:55 IST on BSE after the state-run bank announced reduction in lending rates based on marginal cost of funds for different loan tenures effective from 1 July 2016.

The announcement was made after market hours yesterday, 4 July 2016.

Meanwhile, the BSE Sensex was down 24.02 points, or 0.09%, to 27,254.74

On BSE, so far 4.64 lakh shares were traded in the counter compared with average daily volume of 6.48 lakh shares in the past one quarter. The stock hit a high of Rs 77.45 and a low of Rs 75.55 so far during the day. The stock hit a 52-week high of Rs 95.70 on 3 December 2015. The stock hit a 52-week low of Rs 47.40 on 12 February 2016. The stock had outperformed the market over the past 30 days till 4 July 2016, advancing 17.3% compared with Sensex's 1.62% rise. The scrip also outperformed the market in past one quarter, rising 10.5% as against Sensex's 9.63% gain.

The large-cap state-run bank has equity capital of Rs 2058.82 crore. Face value per share is Rs 10.

IDBI Bank's Marginal Cost of Funds based Lending Rate (MCLR) effective from 1 July 2016 for overnight loans will be 8.60%. For one month, the rate will be 9% and for three months it will be 9.15%. The MCLR on 6-month loans will be 9.25% and for one-year loans the rate would be 9.30%. MCLR for two-year loans would be at 9.55% and loans with three-year maturity would carry an MCLR of 9.70%. All rupee loans sanctioned and credit limits renewed with effect from 1 April 2016 are priced with reference to the Marginal Cost of Funds based Lending Rate (MCLR) which is the internal benchmark of the concerned bank. Actual lending rates are determined by adding the components of spread to the MCLR.

IDBI Bank reported net loss of Rs 1735.81 crore in Q4 March 2016 as against net profit of Rs 545.94 crore in Q4 March 2015. Total income fell 11.81% to Rs 8274.58 crore in Q4 March 2016 over Q4 March 2015.

The Government of India currently holds 73.98% stake in IDBI Bank (as per the shareholding pattern as on 31 March 2016).

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