views
Max Financial Services Ltd shares climbed as much as 15.5% in intra-day trade on Thursday after a media report said that private sector lender Axis Bank Ltd may acquire 20% stake in the insurance company.
At 11:25 am, shares of Max Financial Services were trading at Rs 576.40, up 11.5%, after hitting the day’s high of Rs 597.05. The stock has jumped a whopping 46% in the last one year compared with a nearly 13% rise in the benchmark Nifty 50 index.
Other Max group stocks also rallied tracking gains in Max Financial Services. Max Ventures and Max India both jumped over 7% each. Axis Bank shares, meanwhile, also rose 1.3%.
A report in Economic Times said on Thursday that Axis Bank, which currently owns a little over 2% of Max Life, is expected to infuse an additional Rs 2,000 crore in the insurance company in order to fund its expansion plan. Max Life Insurance is a subsidiary of Max Financial Services.
The proposed deal is aimed at building a strategic and long-term relationship with Axis Bank, which currently contributes more than 54% to Max Life’s revenue, the report added.
Max Financial Services and Max Life Insurance have called a joint board meeting on Thursday to reportedly discuss stake sale in a group company by Max Group chairman Analjit Singh. A CNBC TV18 report said that the meeting, which was expected to start at 11 am, was called at quite a short notice.
Analjit Singh owns 28.31% stake in Max Financial Services, of which 71.54% is pledged. Axis Bank’s move to acquire stake from Analjit Singh can help the Max group chairman deleverage his pledged position, while also helping Axis Bank get an indirect entry into the life insurance space through Max Life Insurance.
Comments
0 comment