praveen
08-01-2008, 09:57 PM
India's most-valuable lender, ICICI Bank, may be planning an initial public offer in its investment banking and broking unit, traders and analysts said on Monday, sending its shares soaring more than 6 per cent.
A spokesman for New York-listed ICICI said it was exploring various opportunities for its subsidiaries and that an announcement would be made if there was any decision.
The bank held a meeting for a group of investors on Monday, and traders said that was the source of the IPO talk in ICICI Securities, which lifted the stock from a 3.9 per cent early fall to end up 6.1 percent at a record close of Rs 1,363.90 ($34.7).
"There is a belief in some circles that if the subsidiaries are valued separately, the sum-of-the-parts business that is the listed entity ICICI Bank would have a far higher valuation than what the market currently reflects," said Arun Kejriwal, director at KRIS.
"It is with this intention that they had called the select investors' meet." Last year, ICICI sold $4.9 billion of shares in India's biggest-ever share sale and Joint Managing Director Chanda Kochhar told a media summit in December it would keep tapping global debt markets to fund lending.
ICICI Securities offers services in corporate finance, fixed income and equities and operates out of Mumbai with offices in New Delhi, Chennai, Kolkata, New York, London and Singapore, according to its Web site. It also has a subsidiary in the United States which is a member of the National Association of Securities Dealers Inc and is registered with authorities in the United Kingdom and Singapore to offer corporate advisory services.
Shares in ICICI Bank, valued at more than $38 billion, rose 38.4 per cent in 2007, lagging a 90.3 per cent rise in government-run State Bank of India and a 47 per cent rise in the main index.
The ICICI stock trades at about 35 times forward earnings, pricier than State Bank's nearly 23 times. But financial services firm India Infoline trades at 81.3 times 2008/09 earnings, according to a media data.
"If India Infoline can quote at this price, then why not ICICI. It is definitely undervalued," said a trader with a local brokerage.
A spokesman for New York-listed ICICI said it was exploring various opportunities for its subsidiaries and that an announcement would be made if there was any decision.
The bank held a meeting for a group of investors on Monday, and traders said that was the source of the IPO talk in ICICI Securities, which lifted the stock from a 3.9 per cent early fall to end up 6.1 percent at a record close of Rs 1,363.90 ($34.7).
"There is a belief in some circles that if the subsidiaries are valued separately, the sum-of-the-parts business that is the listed entity ICICI Bank would have a far higher valuation than what the market currently reflects," said Arun Kejriwal, director at KRIS.
"It is with this intention that they had called the select investors' meet." Last year, ICICI sold $4.9 billion of shares in India's biggest-ever share sale and Joint Managing Director Chanda Kochhar told a media summit in December it would keep tapping global debt markets to fund lending.
ICICI Securities offers services in corporate finance, fixed income and equities and operates out of Mumbai with offices in New Delhi, Chennai, Kolkata, New York, London and Singapore, according to its Web site. It also has a subsidiary in the United States which is a member of the National Association of Securities Dealers Inc and is registered with authorities in the United Kingdom and Singapore to offer corporate advisory services.
Shares in ICICI Bank, valued at more than $38 billion, rose 38.4 per cent in 2007, lagging a 90.3 per cent rise in government-run State Bank of India and a 47 per cent rise in the main index.
The ICICI stock trades at about 35 times forward earnings, pricier than State Bank's nearly 23 times. But financial services firm India Infoline trades at 81.3 times 2008/09 earnings, according to a media data.
"If India Infoline can quote at this price, then why not ICICI. It is definitely undervalued," said a trader with a local brokerage.