Indian Overseas Bank plans to reduce the government’s stake by up to 2.5% in the fourth quarter through a Rs 2,000 crore Qualified Institutional Placement (QIP).
Indian Overseas Bank is set to decrease the Government of India’s ownership in the bank by approximately 2-2.5 percent through a qualified institutional placement (QIP) in the fourth quarter of the current financial year, as stated by Ajay Kumar Srivastava.
During a post-earnings conference call, Srivastava mentioned that a QIP worth Rs 2,000 crore is planned for Q4, which will result in a reduction of the government’s stake by 2-2.5 percent.
Currently, the Central government holds a 96.38 percent stake in Indian Overseas Bank, according to the investor presentation.
Recent reports indicate that the government has approved fundraising plans of up to Rs 10,000 crore for five PSBs through QIP, along with additional stake sales via OFS.
The government’s approval includes QIPs of Rs 2,000 crore each and OFS for five banks – Indian Overseas Bank, Bank of Maharashtra, Punjab & Sind Bank, UCO Bank, and Central Bank of India.
The fundraising will be carried out in small tranches starting this financial year. The Department of Investment and Public Asset Management (DIPAM) has been tasked with divesting stakes via OFS to increase public shareholding.
Sebi mandates all listed companies to maintain a minimum public shareholding of 25 percent. The deadline for all public sector undertakings to comply with this norm was initially set for August 1, 2024, but has been extended to August 1, 2026.
Indian Overseas Bank recently reported a 21 percent year-on-year increase in net profit for the October-December quarter (Q3) of the financial year 2025. The bank’s consolidated net profit reached Rs 875.27 crore in Q3FY25, up from Rs 724.14 crore reported in the same period last year.
IOB reported Rs 7,115.88 crore as interest earned during the quarter, an increase of 15% from the interest earned in Q3FY 24. The bank’s total income also saw a rise of 13% YoY at Rs 8,415.34 crore.
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