Private sector Axis Bank has announced to acquire the Indian business of US-based Citibank. After this acquisition, the share price of Axis Bank can go beyond Rs 1000. Different experts are making these claims.
How much will the share price increase: According to brokerage firm Jefferies, the bank has kept a target price of Rs 1,040 for the next 12-15 months. Along with this, buy rating has been given. At the same time, analysts at Ambit have said that Axis is a strong banking franchise. The acquisition of Citi’s India retail business should strengthen Axis’ competitive position. According to Ambita, the share of Axis can go up to the level of Rs 997.
People at PhilipsCapital are also bullish on the bank stock as they believe Citibank’s consumer portfolio fulfills Axis Bank’s ambition to ‘retailise’ and ‘granularize’ the loan book.
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Axis-City Deals: Let us inform you that Axis Bank has acquired Citigroup’s consumer banking business in India, including credit cards, retail banking, customer credit and asset management, for Rs 12,325 crore. Under this deal, about 3,600 employees of Citibank will join Axis Bank. The deal is expected to be completed in the first half of 2023. The transaction does not include Citi’s institutional client business.
According to Axis Bank, it is the fourth largest bank in terms of issuance of credit cards. It has a total of 86 lakh cards and this deal will add about 2.5 million more credit cards. This will make Axis Bank one of the top three banks in terms of card business in the country. Axis has a retail ledger of around Rs 4 lakh crore and the deal will add around 3 million customers of Citibank India. In addition, it will get seven offices, 21 branches and 499 ATMs in 18 cities.
The retail ledger of City is around Rs 68,000 crore. Of this, retail debt is Rs 28,000 crore. With a total of 1.2 million bank accounts, the Indian business accounts for 1.5 per cent of the bank’s global profit.