SBI For Significant But Not Majority Stake In Tata Motors Finance (24-Feb-2010)
State Bank of India (SBI), India''s largest lender, is quite bullish in vehicle financing as the lender is eyeing a significant stake in Tata Motors Finance.
According to SBI''s chairman, OP Bhatt, "We are looking at the deal--of investing in it (Tata Motors Finance),".
Tata Motors Finance is the vehicle-financing arm of Tata Motors.
Bhatt said, the bank''s investment committee would like the bank to partner in the deal and make some investment.
However, the clearance from RBI is required before that.
Meanwhile, he said that the bank would pick-up a significant stake in the Tata group company but not a majority.
He said that SBI would get huge synergy by this deal in terms of the commercial business of buses and trucks.
SBI is currently trading at Rs.1917, down by 0.19%.
The stock hit an intraday high of Rs.1928 till now, as against the 52-week high of Rs.2500.The stock hit a low of Rs.1910.5 during the day. The stock had hit a 52-week low of Rs.894 on March 9, 2009.
The stock opens at Rs.1925 at BSE. The total traded volume of the scrip on BSE till now stood at 28334.
Meanwhile today, the BSE Sensex is trading up by 19.08 points, or 0.12% , at 16275.05 on 9:31 AM.
Meanwhile today, the NSE Nifty is trading up by 8.65 points, or 0.18% , at 4867.25.
SBI has an equity capital of Rs 634.88 crore as of 2009 Dec. The face value per share is Rs 10. At the current price of Rs 1917, the P/E multiple stood at 13.3189019127433 with book Value of 912.73 and P/BV at 2.10.
The total shareholding pattern of the company as on Dec 2009 stood at Promoters- 59.41%, Institutional Investors- 27.20%, General Public- 5.87% and other investors- 7.52%.
Considering the current price of Rs. 1917 at 9:34:00 AM , the stock had underperformed the market over the past one month till 25/02/2010 declined -3.53% as compared to the Sensex''s return of -0.09% and NSE Nifty''s -0.09 % returns.
Considering the current price of Rs. 1917 at 9:34:00 AM , the stock had underperformed the market over the past one quarter till 25/02/2010 fell -14.35% as compared to the Sensex''s return of -3.85% and NSE Nifty''s -3.85 % returns.
Meanwhile, there was some good news for aspiring entrepreneurs as State Bank of India (SBI) will now lend up to Rs. 10 lakh without any interest to young entrepreneurs so as to motivate them to initiate for their own business.
SBI would provide this loan under its new portfolio - SBI SMILE, which will specially cater to encourage Small and Medium enterprises in the country.
Diverged as Venture Capitalist, SBI will initially place this scheme for 1 year and if the situation warrants, the bank could extend it for further terms.
On the other hand, SBI is eyeing to raise Rs. 20,000 crore through public issue over the next 2 years, where SBI''s total requirement of fund is Rs. 50,000 crore and set a deadline to raise the money during the next 5 years.
Mr. O P Bhatt, Chairman of SBI said that the bank hopes that half of the amount will come from internal accruals, while the remaining amount have to raised through equity. Where, approximately Rs. 15-20,000 crore, would be raised through the equity over the next 2 years
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