Kotak Mahindra Bank inches up after acquiring BSS Microfinance

Kotak Mahindra Bank rose 0.91% to Rs 785.85 at 15:15 IST on BSE after the bank said it has executed binding share purchase agreement to acquire 99.49% of equity shares of BSS Microfinance for all-cash consideration of Rs 139.20 crore.

The announcement was made after market hours on Friday, 30 September 2016.

Meanwhile, the S&P BSE Sensex was up 384.46 points or 1.38% at 28,250.42.

On BSE, so far 1.01 lakh shares were traded in the counter as against average daily volume of 1.59 lakh shares in the past one quarter. The stock hit a high of Rs 793.20 and a low of Rs 784 so far during the day. The stock had hit a record high of Rs 825.60 on 9 September 2016. The stock had hit a 52-week low of Rs 586.50 on 29 February 2016. The stock had outperformed the market over the past one month till 30 September 2016, sliding 0.87% compared with 1.68% fall in the Sensex. The scrip had, however, underperformed the market in past one quarter, gaining 2.05% as against Sensex's 3.21% rise.

The large-cap bank has equity capital of Rs 918.65 crore. Face value per share is Rs 5.

Kotak Mahindra Bank announced that it has executed binding share purchase agreement to acquire 99.49% of equity shares of BSS Microfinance (BSS), a non-banking finance company (NBFC), from existing shareholders subject to regulatory and other approvals, including Reserve Bank of India.

BSS has a commercially established model in the microfinance segment and this acquisition gives Kotak access to BSS' growing customer base which currently stands at over 2.17 lakh and network of 78 branches as of 30 June 2016.

As of 30 June 2016, BSS has a networth of about Rs 73 crore and microfinance loans of Rs 483 crore in its books. It will be a subsidiary of Kotak after receiving regulatory and other approvals.

Kotak Mahindra Bank's net profit rose 291% to Rs 741.97 crore on 11.7% growth in total income to Rs 5120.03 crore in Q1 June 2016 over Q1 June 2015.

Kotak Mahindra Bank is one of the leading private sector banks in India.

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