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Lakshmi Vilas Bank up 20% after business update

The stock locked in upper circuit of 20% at Rs 85.25, bouncing back 25% from its early morning low of Rs 67.95 on the BSE.

SI Reporter  |  Mumbai 

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Shares of (LVB) is locked in upper circuit of 20 per cent at Rs 85.25 on the BSE on Monday after the bank said its asset quality slippages during the current year, have considerably moderated and the Bank has seen impressive growth in low cost CASA balances.

“The Bank has been consolidating its business significantly during the current financial year. Overall, the Bank's funding has become a lot more granular in nature, LVB said on recent volatility in the Bank's stock in the exchanges.

“The Bank's planned capital raising process, including induction of strategic investors, is proceeding as per plan and investment managers have seen good interest from high quality global investors thus far. It is expected that the process would be completed well before the financial year-end,” it said.

“The Tamil Nadu-based mid-sized private sector lender LVB is planning to raise around Rs 20 billion in fresh equity capital before the end of the current financial year, and has appointed JP Morgan Chase for advice on the process,” PTI report said quoting a top official on Sunday.

The bank has also set a target of Rs 8 billion to Rs 10 billion through recoveries from defaulters. So far this fiscal, it has recovered around Rs 3.50 billion from defaulters, it added.

The stock dipped 4% hitting a 52-week low of Rs 67.95, bouncing back 25% on the BSE. A combined 4.67 million equity shares changed hands on the counter on the BSE and NSE.

In past one month, the stock has underperformed the market by falling 25% as compared to 6.3% decline in the S&P BSE Sensex till Friday.

On September 24, the bank informed the stock exchanges that it had received certain queries from investors seeking clarification on the Bank's exposure to the ILFS group.

In this regard, the Bank clarified that it has an exposure to an ILFS subsidiary, which is currently standard. However, due to business constraints, we are unable to share further customer specific data.

The trading volumes on the counter jumped nearly four-fold with a combined 6.93 million equity shares changed hands on the NSE and BSE till 01:33 pm.

First Published: Mon, October 01 2018. 13:35 IST