Kotak CEO Raises Concerns Over IDBI Valuation Amid Ongoing Privatization Efforts

Kotak Mahindra Bank CEO Expresses Concerns Over IDBI Bank Valuation

Kotak Mahindra Bank Ltd. reported better-than-expected fourth-quarter earnings on Saturday, but its chief executive expressed concerns over the valuation sought for a stake in IDBI Bank Ltd. Chief Executive Officer Ashok Vaswani stated that the valuation being demanded was "very, very high" and would have been difficult to swallow.

The bank had shown an expression of interest in IDBI Bank and received a fit-and-proper criteria by India's central bank, but did not submit a bid. This decision underscores tepid bidder appetite for IDBI, despite the government's plan to privatize the bank remaining on track. A finance ministry official stated that all options are still under consideration, citing good performance across profitability and other metrics.

However, the sale process has faced delays after initial bids fell short of the reserve price, highlighting a mismatch between buyer expectations and the state's asking price. IDBI Bank, backed by Life Insurance Corp. of India, reported quarterly earnings that missed estimates on Thursday, adding another layer of uncertainty to the timing and pricing of the divestment.

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Comparison of Bank Performance

Note: The comparison table is incomplete due to the lack of specific earnings data in the original text.

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