IDBI Bank stake sale: Employee forum flags hidden value

IDBI Bank stake sale: Employee forum flags hidden value in land, properties SEBI RA – Shubh Consultancy – Sunil Kotak – INH000015826

The United Forum of IDBI officers and Employees has called the attention of the Chairperson and members of the Standing Committee on Finance in Parliament to the valuation methodology being adopted for the proposed divestment of IDBI Bank (NSE stock symbol: IDBI). IDBI is not merely a quoted equity security, the Forum said in its representation. A strategic acquirer would obtain control not just over an established banking licence but also a nationwide branch network; a significant deposit franchise; millions of customer relationships; technology infrastructure; trained manpower; institutional relationships; brand and goodwill; substantial immovable property accumulated over decades. Land, office buildings Accordingly, the Committee should examine whether the transaction valuation adequately captures the market value, book value, replacement value, franchise value, strategic value, embedded property value, and long-term public development value. A strategic disinvestment of this nature cannot be judged only by the prevailing market price of shares. IDBI has accumulated land, office buildings, residential premises, training establishments and other immovable properties over more than six decades. Many such may have been acquired decades ago at historical costs, while current commercial value in metropolitan and prime urban locations could be substantially higher. All this is for information This is not a buy/sell recommendation. Thank you, Technofunda24