Government might take into account OFS choice; what is understood to date
IDBI Bank stake sale: Shares of IDBI Bank are anticipated to be within the highlight on Monday, March 23, as the federal government might take into account promoting a stake within the lender by means of the Offer-for-Sale (OFS) route to extend public shareholding after the unsuccessful try to divest a stake within the LIC-controlled lender, PTI reported.
Currently, the general public float in IDBI Bank is simply 5.29%, which limits the scope for honest valuation.
The remaining shares are held by the insurance coverage behemoth Life Insurance Corporation of India (LIC), which holds a controlling stake of 49.24%, whereas the Government of India’s (GoI) holding stands at 45.48%.
What occurred earlier this month?
Earlier in March 2026, the proposed sale of a 60.72% majority stake, held collectively by the federal government and the LIC, was scrapped after monetary bids from two potential consumers reportedly fell in need of the reserve value.
Low free float restricts the scope for honest market valuation, and increasing this by 10% or 15% would make value discovery extra dependable, the PTI report, quoting sources, mentioned.
It can present a dependable benchmark for valuation and additional make the worth discovery course of clear, they mentioned, including {that a} strategic sale will be pursued even after one or two tranches of OFS.
As per the failed plan, each the federal government and LIC have been to dump a 30.48% and 30.24% stake, respectively.
IDBI Bank privatisation: A take a look at historical past
This is the second time that the federal government has wished to privatise IDBI Bank for the reason that first announcement made in 2016. The concept was first formally hinted at within the Union Budget speech by then Finance Minister Arun Jaitley in February 2016.
The first try to privatise the then state-owned IDBI Bank failed as a consequence of valuation considerations.
However, the federal government later bought the controlling stake to LIC, which had been eyeing buying a stake in a financial institution to increase its bancassurance enterprise mannequin.
Subsequently, in January 2019, LIC acquired a 51% controlling stake in IDBI Bank for roughly ₹21,624 crore to rescue the lender from heavy unhealthy loans as a part of the disinvestment course of.
As a outcome, the financial institution was categorised as a private-sector financial institution by the Reserve Bank of India.
In December 2020, the lender was reclassified as an affiliate firm following the discount of LIC’s stake within the financial institution to 49.24%.
The course of for privatisation gained formal momentum when the Cabinet Committee on Economic Affairs gave its in-principle approval in May 2021 for strategic disinvestment together with the switch of administration management in IDBI Bank.
In October 2022, KPMG India was appointed as transaction advisor, and the intent to promote a 60.72% stake within the financial institution was introduced.
The Department of Investment and Public Asset Management (DIPAM) invited Expressions of Interest (EoI) in October 2022, and market regulator SEBI authorized the reclassification of GOI as a public shareholder upon completion of the sale in January 2023.
Later in August 2025, the regulator gave its nod for the reclassification of LIC as a public shareholder upon completion of the sale, and after a protracted due diligence interval, monetary bids from Emirates NBD Bank and Prem Vatsa-promoted Fairfax India have been lastly obtained in February 2026.
IDBI Bank Q3 FY26 earnings
IDBI Bank reported an nearly flat revenue at ₹1,935 crore for the third quarter ended December 2025 (Q3 FY26).
The LIC-controlled financial institution reported a web revenue of ₹1,908 crore within the year-ago interval.
However, the financial institution’s whole revenue declined to ₹8,282 crore in the course of the quarter underneath evaluation from ₹8,565 crore in the identical interval final 12 months, IDBI Bank mentioned in a regulatory submitting.
The financial institution’s curiosity revenue additionally fell in the course of the third quarter of the present fiscal 12 months to ₹7,074 crore towards ₹7,816 crore a 12 months in the past.
The gross non-performing asset (NPA) ratio improved to 2.57% as of December 31, 2025, in comparison with 3.57% a 12 months in the past.
However, the online NPA remained static at 0.18% on the finish of December 2025.
During the quarter, nevertheless, the financial institution’s capital adequacy ratio rose to 24.63% in comparison with 21.98% on the finish of December 2024.
On the opposite hand, Return on Assets (ROA) moderated to 1.83% in Q3 FY2026 in comparison with 1.99% for Q3 FY2025.
With inputs from PTI
Disclaimer: This article is solely for informational functions and shouldn’t be thought-about funding recommendation from Upstox. Please seek the advice of with a monetary advisor earlier than making any funding selections.
