Kotak Mahindra Bank rose 2.61% to Rs 964 at 9:35 IST on BSE as the bank proposes to raise the ceiling for foreign investors in the bank to 40% from 37%.
The bank made the announcement after market hours on Tuesday, 18 June 2014.
Meanwhile, the BSE Sensex was up 20.58 points, or 0.08%, to 25,541.77.
On BSE, so far 29,000 shares were traded in the counter, compared with an average volume of 4.75 lakh shares in the past one quarter.
The stock hit a high of Rs 967 in early trade, which is also a record high for the counter. The stock hit a low of Rs 941.60 so far during the day. The stock hit a 52-week low of Rs 588 on 28 August 2013.
The stock had underperformed the market over the past one month till 17 June 2014, rising 3.77% compared with 5.80% rise in the Sensex. The scrip had, however, outperformed the market in past one quarter, rising 24.21% as against Sensex's 17.02% rise.
The large-cap bank has an equity capital of Rs 385.23 crore. Face value per share is Rs 5.
Kotak Mahindra Bank proposes to raise the ceiling for Foreign Institutional Investors (FIIs), Foreign Portfolio Investors (FPIs) and Qualified Foreign Investors (QFIs) investments in the bank to 40% from 37% to help it comply with Reserve Bank of India (RBI) directive to bring down its current promoter stake by one-fourth in little over next two and half years.
The private sector bank in its notice to shareholders for the upcoming annual general meet on 16 July 2014 has sought members' approval to pass a resolution to this effect.
On 30 May 2014, Kotak Trustee Company, a promoter group entity of the Kotak Mahindra Bank, sold 2.49 crore shares, or 3.24% equity, of the bank. After the sale of the shares, the shareholding of promoters in the bank has declined to 40.33%.
Earlier in May 2014, RBI had ordered Kotak Mahindra Bank to bring down its promoter shareholding to 40% by 30 September 2014. Kotak Mahindra Bank will then have until 31 December 2016 to cut its promoter shareholding to 30%.
As on 31 March 2014, promoters held 43.58% stake in Kotak Mahindra Bank. Among the promoter group, Uday Suresh Kotak held the largest stake of 39.76%.
Kotak Mahindra Bank's net profit fell 6.7% to Rs 407.18 crore on 0.7% decline in total income to Rs 2552.96 crore in Q4 March 2014 over Q4 March 2013.
Kotak Mahindra group is one of India's leading financial services conglomerates.
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