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Shares of ICICI Prudential Life Insurance Co Ltd slipped as much as 3.4 per cent to Rs 396.55, lowest since April 24, as ICICI Bank had said on Wednesday that it plans to sell up to 2 per cent stake in its life insurance arm.
“The board of directors of the bank today approved the sale of up to 28,711,100 shares, representing up to 2 per cent of the issued and the paid-up equity share capital of ICICI Prudential Life Insurance Company Limited (Company) in one or more tranches,” it had said in a regulatory filing on Wednesday.
Shares of ICICI Bank Ltd fell as much as 1.6 per cent in the morning trade.
ICICI Bank will offer for sale stake in ICICI Prudential (ICIR) with a floor price of Rs 390, which is at about 5 per cent discount to ICICI Prudential’s closing price, says Jefferies.
Analysts say the deal should fetch ICICI Bank about Rs 1,120 crore ($165.7 million) or about 4.5 per cent of its FY 2019 operating profits.
Jefferies has maintains “buy” rating on ICIR with a price target at Rs 520. Over 1.6 million shares changed hands vs 30-day moving average of 1.3 million. Of 22 analysts covering ICIR stock, 21 rate it “buy” or higher, while 1 rates it “hold”; their median price target is Rs 520, according to Thomson Reuters data.
Up to Wednesday's close, the ICIR stock had risen 7 per cent this year.
(With inputs from Reuters)
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