State Bank of India share price (SBI) dropped over 2% intraday on Monday after largest state-run lender reportedly scrapped its plan to list its general insurance arm on domestic bourses saying that there is no need for additional capital now.
Reacting to the news, the stock opened 1.3% lower on Monday at Rs 287.90 apiece, against the last closing value of Rs 291.70 on BSE, and later dropped by 2.62% to hit the day's low at Rs 284.05 on BSE. SBI stock has fallen after 5 days of consecutive gain.
SBI stock price has moved below its 30-day simple moving average today and already trades lower than its 50,150 and 200-day moving averages.
In a reply to a question, whether the IPO for general insurance will happen next fiscal, SBI chairman Rajnish Kumar told news agency PTI that there was no requirement for capital. He added that the IPO would be launched in the January-March quarter of the current fiscal and based on the valuation arrived at, SBI will take a call on the stake sale.
Earlier, the public sector lender was looking for an initial public offer (IPO) for SBI General Insurance arm in FY20. Incorporated in 2010, SBI General Insurance is the joint venture between State Bank of India and International Pty Ltd (IAG), in which SBI owns 70% in the venture while IAG holds 26%, respectively.
Rajnish Kumar, however, added that while the lender has scrapped plans for general insurance-arm, SBI Card listing will happen by this fiscal.
By the closing bell, 8.2 lakh and 182.6 lakh shares changed hands on domestic bourses BSE and NSE, respectively. The stock closed at Rs 284.65 today which is 37 points or 13% higher than its 52-week low of Rs 247.65.
By Rupa Burman Roy
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