New Delhi : Now is the best chance for Kotak Mahindra Bank to acquire Axis Bank, one of the largest liability and retail franchise, brokerage firm Nomura Financial Advisory Services said in a report on Tuesday.
The brokerage’s observation comes in the aftermath of Axis Bank’s board cutting short its CEO Shikha Sharma’s fourth term to the end of 2018 after the Reserve Bank of India reportedly did not approve her re-appointment. “With a very short time left in the CEO’s term at Axis Bank, RBI’s pressure on Axis Bank’s management and with an asset quality clean-up exercise continuing, we believe this is the best opportunity for Kotak Bank to acquire or merge with Axis Bank,” the brokerage said. The deal if explored could make the combined entity the second largest private bank in India in terms of advances and largest in terms of branches. Nomura Financial Advisory Services expects little backlash from Axis Bank if Kotak Mahindra Bank expressed an interest in acquiring it given the loss of confidence of the regulator and a vacuum at top management.
Axis Bank scrips up 5%
NEW DELHI: Shares of Axis Bank on Tuesday surged over 5 per cent, adding Rs 7,212 crore to its market cap, a day after its CEO and MD Shikha Sharma’s tenure was shortened. The stock rose 5.43 per cent to end at Rs 546 on BSE. At NSE, shares soared 5.17 per cent to Rs 546.15.