Canara Bank shares gain on in-principle approval to dilute stake via listing of CRAMC

Shares of Canara Bank in Monday's session (April 1, 2024) traded with gains of over 1 per cent at Rs 589.1 apiece as the state-run lender gave its go-ahead to begin the process of offloading a 13 per cent stake in the bank by listing Canara Robeco Asset Management Company (CRAMC) through the initial public offer (IPO). The stock price over the last two days has increased by 4.56 per cent.
 
"We had informed stock exchanges regarding in-principle approval to initiate the process of listing our mutual fund subsidiary, Canara Robeco Asset Management Company Ltd., by way of an initial public offer (IPO)," said the lender in its exchange filing dated March 28, 2024.
 
Canara Bank has accorded approval for initiating the process of diluting a 13 per cent stake in the bank by listing Canara Robeco Asset Management Company Ltd. (CRAMC) on the stock exchange by initial public offering (IPO), subject to approval from the Reserve Bank of India and the Department of Financial Services, Ministry of Finance, Govt. of India, according to the company's filing.
 
At the day's high, the stock scaled to levels of Rs 590, gaining 1.53 per cent over the previous close.
 
Earlier in February, the public sector bank announced a 1:5 stock split, entailing the sub-division of its shares of Rs 10 into five shares with a face value of Rs 2 each.
 
The company stated that it would take around two to three months, considering the time taken to receive the RBI's approval for completing the stock split process. The decision for a stock split is taken to improve the bank’s share’s liquidity, make it affordable for retail investors, and broaden the retail inve