CSB Bank shares surge 7% as FIH Mauritius likely offloads stake via block deal

Shares of Kerala-based CSB Bank rose 7% in the early trading session on BSE to Rs 382.10, after investment firm FIH Mauritius likely sold off a 9.6% stake in the bank through a block deal.

According to the term sheet issued by the banker IIFL, FIH Mauritius was expected to sell 1.68 crore shares in the bank at a floor price of Rs 352.40 per share. The floor price represents a 1% discount to Wednesday’s closing price of Rs 355.95.

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FIH held a 49.72% stake in the bank as of March 31, 2024, which will be reduced to nearly 40% post the stake sale. Shares of CSB Bank have declined 11% so far this year compared to the Sensex's gain of approximately 9%.

Overall, the public held 47.66% stake in the company as of March 2024 while 49.72% stake was held by the promoter and the promoter group.

In December last year, the promoter received approval from the Reserve Bank of India (RBI) to retain a 26% stake in the bank instead of the 15% previously advised by the central bank. Accordingly, FIH Mauritius Investments must reduce its shareholding to 26% within 15 years from the date of the completion of investments, which was in 2018.

Technically, the stock displays a good placement on the charts as well, wherein the share prices are performing well above their significant exponential moving averages and oscillating in a mid-range near the 56 level on the RSI, as per the Trendlyne data.

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