Buy IFCI (Rs.60.20) Target Rs.80
There is every possibility of IFCI become bank soon. So buy it at current price and keep it for a period of 6 months to 1 year.
When anyone looks the PE ratio of banks, investor can understand the strength in IFCI stock. It will flare up once IFCI is given licence by Indian govt and it is likely.
News from NDTV site - Your comment pl
ReplyDeleteNew bank licenses "long way off", says financial services secy
MUMBAI, SEPTEMBER 07: The Reserve Bank of India's grant of banking licenses to new entities may not happen quickly, Financial Services Secretary R. Gopalan said Tuesday.
"Its long way off," he told reporters after a conference to mark Bank of India's 105th anniversary.
The official, however, did not give a timeframe.
Finance companies owned by Anil Ambani, AV Birla, Shriram groups, apart from long-term lenders like IFCI and Sidbi, are keen to enter the banking space.
However, they have to wait for some time, as the final guidelines are unlikely to come in near term.
Finance Minister Pranab Mukherjee announced plans to issue more banking licenses in the Union Budget 2010-11.
Accordingly, the RBI put out a discussion paper in August seeking opinion on new private bank licences by Sep 30.
Comprehensive guidelines on the licences would be framed and applications would be invited after discussions based on the feedback, the central bank said.
RBI has suggested three alternatives for minimum capital requirements for new banks and promoters' contribution in the discussion paper.
The first option was for a minimum capital requirement of over Rs. 3 billion, the second option was for capital
close to Rs. 10 billion and the third option was for an initial capital of R
s. 5 billion that can be doubled within
five years.
RBI has also stated the minimum and maximum caps that would be needed on promoter shareholding and other subsidiaries.
The central bank has suggested an option of promoters bringing minimum of 40% capital with a five-year lock-in period.
The discussion paper suggests that aggregate non-resident investment, including foreign direct investment, non-resident Indian and foreign institutional investors, be capped below 50% with a 10-year lock-in period initially.
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