Why are IOB, Persistent Systems and IDBI Bank actions mobilized today?
In a larger, weaker market with a decline of around 0.4% at the time of writing, stocks such as Indian Overseas Bank (NS :), Persistent Systems (NS :), and IDBI Bank (NS: ) increased by 12%, 4% and 4% respectively. Here are the reasons why we are seeing action specific actions today:
1) Indian Overseas Bank: The bank received a boost from the RBI in which the central bank announced that it would remove the IOB from its PCA (Prompt Corrective Action) framework due to improving credit and the bank’s financial profile . As a reminder, IOB was placed under PCA in 2015 due to high NPAs and a negative ROA. After the removal of the BIO from the PCA framework, the Central Bank of India (NS 🙂 is the only bank remaining under the PCA.
2) Persistent systems: This mid-cap IT company has announced that it will acquire US-based Software Corporation International for $ 53 million. Through this acquisition, the company will strengthen its BFSI (Banking, Financial Services and Insurance) expertise and will form the creation of a new Payments Business Unit.
3) IDBI Bank: On September 27, the rating agency ICRA (NS 🙂 upgraded IDBI Bank’s ratings and kept the outlook stable. This news has encouraged investors and the bank’s shares have made a nice 20% gain in the past 4 days.