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Axis Bank gets CCEA nod to hike foreign investment to 62%

The Hindu Business Line:  December 27, 2013

New Delhi: The Cabinet Committee on Economic Affairs (CCEA) on Thursday approved a proposal to increase foreign holding in Axis Bank to 62 per cent from the current 49 per cent. This may result in overseas fund inflow of nearly Rs 7,250 crore into the country.

The CCEA nod is, however, subject to foreign institutional investors’ holding capped at 49 per cent.

The Foreign Investment Promotion Board (FIPB) approved the proposal to hike the foreign investment limit in Axis Bank to 62 per cent in September, after which the matter was referred to the CCEA.

In June-end, FII holding in Axis Bank was at 40.7 per cent and global depository receipts (GDRs) stood at 8.08 per cent.

Life Insurance Corporation, General Insurance Corporation, New India Assurance, National Insurance Company and Administrator of Specialised Undertaking of the Unit Trust of India (SUUTI) are the promoters of the bank.

On Thursday, Axis Bank’s shares closed at Rs 1,300 on the National Stock Exchange, up Rs 17.05 over the previous day’s close.

Indications are that SUUTI may in the coming days completely exit from Axis Bank.

A decision to this effect is, however, yet to be taken by the Centre.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

x IBEF : India Brand Equity Foundation