While Kotak Mahindra Bank (KMB) refrained from making a financial bid as part of the disinvestment process for IDBI Bank due to the latter’s very high valuation, it is not averse to weighing options if the disinvestment process is restarted.
“From a valuation perspective, obviously, it (IDBI Bank) was very, very highly valued.
“....It (acquiring a majority stake) wasn’t a must for us to do, the valuation was very high and obviously it would have been a difficult thing to swallow,” said Ashok Vaswani, MD & CEO, KMB.
Stock surge inflated IDBI Bank valuation
He noted that after the disinvestment process was announced in 2022, IDBI Bank’s stock rose sharply, boosting its valuation.
As per the 2022 preliminary information memorandum inviting expression of interest for strategic disinvestment in IDBI Bank, the Government of India (GoI) and Life Insurance Corporation of India (LIC) planned to sell such number of shares representing 30.48 per cent and 30.24 per cent, respectively, of the equity share capital of the Bank, along with transfer of management control in it.
Disinvestment called off after bids fell short
The aforementioned disinvestment process fell through in March 2026, with the government calling it off after the offers received fell short of its minimum price expectations. Fairfax Financial and Emirates NBD were believed to be the front-runners to take a majority stake in the Bank.
Government may revive stake sale process
The government is understood to have revived plans for the IDBI Bank disinvestment process, as foreign investors are interested in buying large stakes in Indian banks and non-banking financial companies, as evidenced by recent transactions.
Published on May 2, 2026