RBL Bank rallies 5%, hits over 5-year high on Emirates NBD stake buy report

RBL Bank said the Bank is on a growth trajectory and routinely explores opportunities which are aimed at enhancing shareholder value

RBL Bank share price today

 

Shares of RBL Bank hit an over five-year high of ₹305 on the BSE today, surging 5 per cent in Wednesday's intraday trade, amid heavy volumes. The stock of the private sector lender was trading higher for a second straight day amid reports that Emirates NBD Bank PJSC, the UAE's second-largest lender, was in advanced talks to acquire a controlling 51 per cent stake in RBL Bank.

 

With today's rally, RBL Bank's share price has surpassed its previous high of ₹300.50, which it had touched in January 2024. Currently, it is quoting at its highest level since March 2020. The stock had hit an all-time high of ₹716.55 on May 28, 2019. Meanwhile, the market price of RBL Bank has more-than-doubled from its 52-week low level of ₹146, touched on January 20, 2025.

 

 

Dubai's Emirates NBD eyes majority control in RBL Bank

 

As per reports, Emirates NBD Bank PJSC, the UAE's second-largest lender, is in advanced talks to acquire a majority 51 per cent stake in RBL Bank through a mix of preferential share allotment and an open offer. The capital infusion, aimed at strengthening RBL Bank's balance sheet, would make Emirates NBD its single largest shareholder. An in-principle approval from the Reserve Bank of India (RBI) for the change of control may have been received.

 

Analysts at ICICI Securities believe the entry of a large, well-capitalised global promoter like Emirates NBD could strengthen governance standards at RB Bank, boost investor confidence, and support a potential re-rating of the stock.  CATCH STOCK MARKET LIVE UPDATES TODAY

RBL Bank's clarifications

 

On Tuesday, RBL Bank said that it is on a growth trajectory and routinely explores opportunities which are aimed at enhancing shareholder value. However, any such discussions do not warrant a disclosure at this stage, the bank said.

 

"We are not aware of any information that has not been announced to the Exchanges, and which requires disclosures at this stage. We adhere to the highest standards of governance and disclosures, and will keep the stock exchanges informed of any material events as required under Regulation 30 of the Listing Regulations," RBL Bank said in a stock exchange filing.

 

Rating agencies on RBL Bank

 

Despite the asset quality stress in the past, the RBL Bank's headline asset quality numbers, i.e. gross and net non-performing advances (NPAs), witnessed relatively less deterioration because of sizeable write-offs as per its internal policy. As a result, RBL's overall credit costs remained elevated, impacting its profitability and return metrics. While RBL continues to guide towards lower slippages going forward, its ability to keep incremental slippages in check will remain a near-to-medium-term monitorable.

 

Nevertheless, the cost of deposits is expected to decline and is likely to support net interest margin (NIM) in H2FY2026. Besides, the bank is expected to witness operational synergies. This, coupled with the likely reduction in credit costs, would support the overall profitability. However, the stress in the unsecured segment on account of worsening credit discipline, overleveraging of borrowers and the impact of economic shocks/disruptions on the asset quality will remain monitorable, Icra said in a rating rationale.

 

Going forward, CARE Ratings expects some pressure on the bank's NIM in line with the industry trend due to faster transmission of the recent repo rate cuts in yield on advances than in cost of funds, which would impact profitability in H1FY26. The bank's ability to maintain its profitability and asset quality in the medium term remains a monitorable, the rating agency said.