DCB Bank surges 8% as RBI allows Tata MF for raise stake up to 7.5%

The Reserve Bank of India has granted its approval to Tata Asset Management Company (AMC) to increase stake in the private sector lender up to 7.5 per cent.

Shares of DCB Bank rallied 8 per cent to Rs 131.50 on the BSE in Thursday’s intra-day trade amid heavy volumes after the Reserve Bank of India (RBI) granted its approval to Tata Asset Management Company (AMC) to increase stake in the private sector lender up to 7.5 per cent.

DCB Bank in an exchange filing said the Bank has received an intimation from RBI on Wednesday July 5, receiving approval allowing Tata Asset Management Private Limited (TAMPL) to acquire aggregate holding of up to 7.5 per cent of the paid-up equity capital of the Bank through the schemes of Tata Mutual Fund. The approval is valid for a period of one year from the date of RBI letter (July 5, 2023).
 

TAMPL is also advised by the RBI to ensure that its aggregate shareholding in the Bank shall not exceed 7.5 per cent of the paid-up capital of the Bank at all times. TAMPL currently holds up to 4.95 per cent stake in the Bank.

At 09:45 AM; DCB Bank was quoting 6 per cent higher at Rs 128.15, as compared to 0.06 per cent rise in the S&P BSE Sensex. The average trading volumes on the counter jumped 1.5 times today. A combined 4.4 million shares changed hands on the NSE and BSE. The stock of DCB Bank had hit a 52-week high of Rs 141.20 on December 13, 2022.

The stock has witnessed a decent pullback from the significant 50EMA and 200 period MA of around 116 levels and has improved the bias to anticipate for further rise in the coming days, according to Technical Research at Prabhudas Lilladher.

The RSI has also indicated a trend reversal showing strength to signal a buy and currently is well placed with much upside potential visible to carry on the momentum still further ahead. The brokerage firm suggest buying and accumulating the stock for an upside target of Rs 142 while keeping the stop loss at Rs 116.