Shares of ICICI Lombard General Insurance Co. advanced on Monday after the insurance regulator approved the acquisition of up to 4% additional stake by ICICI Bank Ltd.
The stake increase is through purchase of shares from the market. The acquisition will make the insurance firm a subsidiary of ICICI Bank. according to an exchange filing on Sept. 1. ICICI Bank currently owns a 48.02% stake in ICICI Lombard as of March 31.
The approval by the Insurance Regulatory and Development Authority of India subject to the condition that ICICI Bank will continue to act as promoter of the company.
Shares of ICICI Lombard rose 4.29% to Rs 1,398.9 per share, the highest since May 29. The shares are trading 0.88% higher at Rs 1,353.20 apiece in comparison to a 0.26% advance in the benchmark NSE Nifty 50 as of 12:11 p.m.
The stock has risen 9.8% on a year-to-date basis .The total traded volume stood at 2.4 times its 30-day average. The relative strength index was at 52.96.
Of the 27 analysts tracking ICICI Lombard, 18 maintain a 'buy' rating, six suggest a 'hold', and three recommend a 'sell', according to Bloomberg data. The average of 12-month price targets given by analysts implies an upside of 6.3%.
ICICI Bank's stock was trading 0.66% lower at Rs 962.35 apiece in comparison to a 0.26% advance in the benchmark NSE Nifty 50 as of 12:15 p.m. The stock fell 0.84% to hit an intra-day low of 960.55 apiece.
The stock has risen 8.03% on a year-to-date basis. The total traded volume stood at 2.4 times its 30-day average. The relative strength index was at 48.06.
Forty-five out of the 49 analysts tracking ICICI Bank maintain a 'buy' rating on the stock and four suggest 'hold', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 22.4%.
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