IDBI Bank shares advanced 2.4% to close at ₹86.12 on Tuesday after reports surfaced that India’s government is nearing approval of a sweetened bid from Canada-based Fairfax Financial Holdings Ltd. The coverage indicated Fairfax may lift its per-share offer by a few rupees after an earlier valuation was rejected for being below the government’s reserve price.
Business Standard reported that the government is close to accepting an offer from Fairfax, possibly at a slightly higher price. The story follows a sequence of events tied to the government’s push to privatise the bank - a process that has been building momentum over recent months.
Officials have been seeking fresh bids for IDBI Bank’s privatisation with the aim of completing the transaction by fiscal year 2027. The combined sale of the government and LIC stakes is projected to fetch between ₹50,000 and ₹55,000 crore, according to the report.
Market observers pointed to Fairfax India’s recent acquisition of nearly $1 billion in Indian government bonds, an action widely viewed in the market as related to Fairfax’s interest in acquiring a stake in IDBI Bank. While the report linked the bond purchases to the proposed takeover, it did not supply additional details beyond the transactions mentioned.
IDBI remains in focus ahead of its annual general meeting. The bank’s 22nd AGM is scheduled to be held via video conference on July 21-22. The meeting will review financial results, consider director appointments and address special resolutions, including related party transactions with LIC Mutual Fund.
The stock’s gain outpaced the broader market trend on Tuesday: the Nifty 50 index moved lower by 0.6% on the day.
In sum, the market reaction on Tuesday reflected investor attention on a potential privatisation outcome and related corporate actions. Key datapoints driving the move included the reported possibility of Fairfax raising its bid by a few rupees, the sizable expected proceeds from stake sales, and the proximity of the bank’s AGM.