PNB shares gains 8 percent on govt's nod to divest stake in UTI AMC
Published On: Friday, November 25, 2022 | By: Team KnowMyStock
Shares of Punjab National Bank the country’s second-largest public sector bank surged 8 percent to hit a 21-month high of Rs 54.90 per share in Friday’s intra-day trade after the state-owned lender received the government’s approval to divest its entire stake in UTI Asset Management Company (AMC). PNB owned a 15.22 percent stake in UTI Asset Management Company as of September 30. That stake is valued at Rs 1,394.52 crore today, following a 7.36 percent rise in the AMC stock. The AMC stock hit a high of Rs 740.15 on BSE today. "The Exchange is hereby informed that the Bank has received approval of DIPAM, Ministry of Finance, Government of India for divestment of Bank's entire/part stake in UTI Asset Management Company Limited in single or multiple tranches subject to compliance of SEBI Regulations/other applicable regulatory guidelines," the bank said in a regulatory filing. The timeline for making the divestment is yet to be finalized, the bank said.
UTI AMC is promoted by four sponsors - State Bank of India, Life Insurance Corporation of India, Bank of Baroda, and Punjab National Bank - collectively holding 45.16 percent of the shares of UTI AMC.
The stock has risen nearly 28% in the last month, while it has surged 86% in the last six months.
Out of the 14 analysts covering the stock, only two have buy ratings while six have sell ratings, and another six have hold ratings. The average share price target of the stock signals a downside potential of 25% from the current market price.
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