Bandhan Bank Shares Plummet 7 Percent Amid Promoter's Potential Stake Divestment and Upcoming IPO

Bandhan Bank Shares Plummet as Promoter Explores Exit Options

Bandhan Bank Ltd shares fell sharply on Monday, declining 7% in late morning trade. The decline was attributed to reports that its promoter, Bandhan Financial Services, is exploring options such as a stake sale or an IPO (Initial Public Offering) to facilitate exits for long-term investors.

Bandhan Bank stock was trading at Rs 164, down 6.6% on the day, making it one of the top losers on the BSE Midcap index. The stock had gained 30% in the one year prior to today's fall.

Bandhan Financial Services has engaged global investment banker Jefferies to explore potential options, including selling shares to private equity investors or launching an IPO. The move is aimed at providing an exit route for long-term institutional investors such as International Finance Corporation (IFC) and GIC Ventures, while also helping address regulatory requirements related to promoter shareholding in Bandhan Bank. Promoter group entities own a 39.74% stake in the bank.

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The proposed restructuring would allow existing investors to monetize their holdings while enabling the promoter group to reduce its stake in the bank in line with regulatory norms. Bandhan Financial Services currently serves as the promoter entity of Bandhan Bank.

In a separate development, in February, the Reserve Bank of India approved a proposal by SBI Mutual Fund to acquire an aggregate holding of up to 9.99% in Bandhan Bank.