IDFC in the limelight

IDFC is seeing some good traction today. Volumes are at almost 12 lakh shares traded today compared to 9 lakh shares over two-week average. The stock is in the green, up 2% at Rs.175.40 with an intra day high at Rs.178.75.

The stock is up after the institution announced that it has received shareholders approval to de-merge its financial business into IDFC Bank. This marks the final milestone in setting up a bank; it has stated that it has received approvals from RBI to begin operations of IDBI Bank from 1st October. It plans to begin with 20 branches.

The reason why shareholders of IDFC are excited is because they will now get shares of IDFC Bank while holding shares in IDFC. And by issuing shares to IDFC shareholders, the institution is complying with RBIs diktat of getting ready, much ahead of time, to get the bank listed within three years of starting operations.