IDFC rose 4.93% to Rs 157.40 at 11:46 IST on BSE after the Reserve Bank of India announced incentives to raise long term bonds for infrastructure financing.
Meanwhile, the BSE Sensex was up 26.34 points, or 0.10%, to 25,254.99.
On BSE, so far 22.83 lakh shares were traded in the counter, compared with an average volume of 14.60 lakh shares in the past one quarter.
The stock hit a high of Rs 158.75 and a low of Rs 154.50 so far during the day. The stock hit a 52-week high of Rs 159.75 on 10 July 2014. The stock hit a 52-week low of Rs 76.25 on 28 August 2013.
The stock had outperformed the market over the past one month till 15 July 2014, rising 17% compared with the Sensex being flat in the same period. The scrip had also outperformed the market in past one quarter, rising 25.58% as against Sensex's 12.20% rise.
The large-cap company has an equity capital of Rs 1516.84 crore. Face value per share is Rs 10.
Shares of IDFC, which is in the process of converting into a bank and which has a large exposure to the infrastructure sector, is seen as one of the main beneficiaries of the measures announced by the Reserve Bank of India's (RBI) on Tuesday, 15 July 2014.
RBI announced that banks can issue long-term bonds with a minimum maturity of seven years to raise resources for lending to long term projects in infrastructure sub-sectors and affordable housing. The minimum maturity period of the long-term bonds shall be seven years. These bonds will be exempted from computation of net demand and time liabilities (NDTL) and would not be subjected to cash reserve ratio (CRR)/statutory liquidity ratio (SLR) requirements. This exemption will be subject to a ceiling of the eligible credit which has been decided by the RBI.
RBI's regulatory incentives for infrastructure financing come after Finance Minister Arun Jaitley on 10 July 2014 said at the time of presentation of Union Budget 2014-15 that banks will be permitted to raise long-term funds for lending to infrastructure sector with minimum regulatory pre-emption such as CRR, SLR and Priority Sector Lending.
The RBI on Tuesday also said that it has issued a number of instructions to banks, specifying the operational guidelines and incentives in the form of flexibility in loan structuring and refinancing so as to mitigate the Asset-Liability Management (ALM) problems faced by banks in extending project loans to infrastructure and core industries sectors.
IDFC in April this year received in-principle approval for banking license from the Reserve Bank of India. The banking regulations require that a bank should be floated by a domestic entity and it should pare foreign investor holding to 49% to run banking services.
IDFC's consolidated net profit declined 50.9% to Rs 257.94 crore on 0.1% growth in total income to Rs 2219.57 crore in Q4 March 2014 over Q4 March 2013.
IDFC is an integrated infrastructure finance player providing end to end infrastructure financing and project implementation services. The company also offers asset management services through IDFC Mutual Fund.
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