IDFC Bank rose 7.80% to Rs 51.85 at 15:30 IST on BSE after the bank said it signed an agreement to acquire Tamil Nadu-based Grama Vidiyal Micro Finance.
The announcement was made during trading hours today, 12 July 2016.Meanwhile, the BSE Sensex was up 181.45 points, or 0.66%, to 27,808.14.
On BSE, so far 41.51 lakh shares were traded in the counter, compared with an average volume of 11.07 lakh shares in the past one quarter. The stock hit a high of Rs 53.90 and a low of Rs 48.15 so far during the day. The stock hit a record high of Rs 73.45 on 6 November 2015. The stock hit a record low of Rs 43.15 on 21 January 2016. The stock had underperformed the market over the past one month till 11 July 2016, rising 1.26% compared with 3.72% rise in the Sensex. The scrip had also underperformed the market in past one quarter, falling 8.99% as against Sensex's 10.41% rise.
The large-cap company has an equity capital of Rs 3394.90 crore. Face value per share is Rs 10. Shares of IDFC Bank listed on the stock exchanges on 6 November 2015.
IDFC Bank signed a share purchase agreement to acquire 100% of Grama Vidiyal Micro Finance, one of the largest microfinance institutions in the country. Upon completion of acquisition, Grama Vidiyal will be a wholly-owned subsidiary of IDFC Bank.
Grama Vidiyal will act as a dedicated Business Correspondent of IDFC Bank, and will help deepen reach and widen the delivery mechanism for banking services. The move enables IDFC Bank to significantly enhance its network and reach and make basic banking services available to a large customer base.
The acquisition will give IDFC Bank immediate access to 1.2 million rural and semi-urban households and Grama Vidiyal's network of 319 locations across 65 districts of Tamil Nadu, Kerala, Karnataka, Pondicherry, Maharashtra, Gujarat and Madhya Pradesh will act as BC centres to IDFC Bank. Current customer households of Grama Vidiyal, in turn, will benefit from IDFC Bank's full range of liability products, customised credit offerings, innovative digital services and doorstep banking.
The 30-year-old, Tamil Nadu-headquartered Grama Vidiyal has an AUM (Assets Under Management) of Rs 1502 crore of micro finance assets, as on 31 March 2016. All loan assets on the book will be transferred to IDFC Bank.
Grama Vidiyal's employee base of over 3000, with an understanding of the needs of local communities, will represent IDFC Bank, in their branch locations. Members of Grama Vidiyal will use IDFC Bank's innovative and inter-operable Micro ATM, which functions like a Bank-in-a-Box, allowing customers as well as non-customers to transact from the comfort of their homes and neighbourhoods. In addition to Grama Vidiyal's existing locations, IDFC Bank plans to set up new bank branches in areas where Grama Vidiyal's presence is concentrated to complement and support the BC operations.
IDFC Bank reported net profit of Rs 165.06 crore on operating income of Rs 1953.20 crore in Q4 March 2016.
IDFC Bank is a subsidiary of IDFC. The Reserve Bank of India (RBI) granted a universal banking license to IDFC on 23 July 2015. IDFC demerged on 1 October 2015, transferring all assets and liabilities of its lending business to IDFC Bank.
IDFC Bank is a universal bank, offering financial solutions through its nationwide branches, internet and mobile. IDFC Bank will focus on serving the rural underserved communities and the self-employed, while continuing to support the country's infrastructure sector. IDFC Bank provides customized financial solutions to corporates, individuals, small and microenterprises, entrepreneurs, financial institutions and the government.
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