Shares of IDBI Bank surged by 8% on October 28 following reports that the government is poised to invite bids for a stake sale. According to Moneycontrol, officials from the Department of Investment and Public Asset Management and the Department of Financial Services are scheduled to meet on October 31 to finalize the bidding process. This meeting aims to approve the Share Purchase Agreement (SPA), which outlines buyer obligations and management control transfer, and set a timeline for inviting financial bids from potential investors. By 1:50 PM on the same day, IDBI Bank shares were trading at Rs 103, reflecting a 7.5% increase, with trading volumes reaching 67 million shares, significantly above the 30-day average.

The approval of the SPA and the subsequent invitation for financial bids signify a critical step in the long-awaited privatization of IDBI Bank, a process that began in 2021. The Centre and the Life Insurance Corporation (LIC) currently hold a combined 94.71% stake in the bank and plan to divest 60.72% to a strategic investor, effectively relinquishing management control. A source familiar with the developments indicated that most groundwork has been accomplished, and the upcoming meeting is crucial for propelling the transaction into its final phase without delays.