- Government may restart IDBI Bank privatisation due to low bid valuations
- Current bids are reportedly between Rs 40,000 and Rs 45,000 crore, below reserve price
- High-level meeting chaired by Cabinet Secretary is underway to decide next steps
The government may decide to initiate a fresh bidding process for the privatisation of IDBI Bank Ltd., as the bids received so far are understood to be significantly below its expected valuation, according to sources familiar with the matter.
A high-level meeting chaired by the Cabinet Secretary is currently underway to take a final call on the future course of action regarding the PSU lender. This marks the second meeting in a week involving senior officials from the Department of Investment and Public Asset Management (DIPAM), the Department of Financial Services (DFS), and other concerned departments.
Sources indicated that the government is inclined to shelve the current set of bids after two potential bidders reportedly quoted a valuation in the range of Rs 40,000-Rs 45,000 crore. These bids are said to be well below the government's minimum reserve price for the bank.
Given the valuation mismatch, the government may opt to restart the privatisation process through fresh bidding. However, officials acknowledged that a new bidding exercise would take additional time, as the entire process would have to begin from scratch.
A final decision is expected after the ongoing deliberations conclude.
Shares of IDBI Bank traded 1.2% lower at Rs 68.84 on the NSE as of 12:20 p.m., compared to a flat Nifty 50. The stock is down 35% year-to-date.
ALSO READ: IDBI Bank Q4 Business Update: Loan Growth Strong, Deposit Momentum Steady
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.