Kanara Bank stock price: After submitting the IPO paper to the Market Watch Dog Securities and Exchange Committee (SEBI) in India after both entities, namely Kanala Robeko and Kanala HSBC insurance supported by the state-owned Kanala Bank, here you will need to purchase this PSU bank share, which is below Rs 100 or buy it now. Each on NSE.
Previously posting the company’s third quarter results, Lender Managing Director K Satyanarayana Raju said in a call from an analyst, “We expect both companies to come to the IPO in the next fiscal year.”
Kanara Bank has a good foundation
Vaibhav Vidwani, research analyst at Bonanza Group, points out that the company’s shares are currently trading at P/B or price/book value at 0.85 times.
Base, Capital Validity Ratio (CAR) of 16.44.
Furthermore, the bank’s deposit (CD) ratio is 76.65%, reflecting the bank’s ability to deliver stable credit growth. Additionally, banks are investing in technology, reducing bad loans.
Canara Robeco AMC IPO
Canara Robeco AMC, a joint venture between Canara Bank (51%) and Orix Corporation (49%), has applied for an IPO, which is configured as an offer of sales (OFS). Existing shareholders are selling interests. Canara Bank is planning to sell 13% of its shares (approximately 25.92 million shares), while Orix sells 12% and values its IPO at around 800-1,000 crores. Canara Robeco AMC is India’s second oldest mutual fund home, managing an AUM of around Rs 1 trillion.
Canara HSBC Life Insurance IPO
Kanala HSBC Life Insurance, a joint venture between Kanala Bank (51%), HSBC Insurance (26%) and Punjab National Bank (23%), has filed for an IPO via an offer to sell Kanala Bank of up to 14.5% of its shares and applied for an IPO via an offer to sell. The IPO could be valued at around Rs 16,500, and Kanara Bank is expected to raise around Rs 2,200 from the stock sales.
The IPO is part of Kanara Bank’s strategy to unlock value and improve capital adequacy. As IPOs are primarily OFS, Canara Bank raises capital that can reduce the interests of these subsidiaries, strengthen their balance sheets, and support loan growth.
RBI requires that Kanara Bank reduce the holdings of these subsidiaries to 30% by October 2029, which could lead to further sales.
Should I buy shares in Kanara Bank now?
Vidwani believes that Canara Robeco AMC’s IPOS and Canara HSBC’s life insurance are likely to draw out the value of Canara Bank, and could have a positive impact on the stock price.
