IDBI Bank shares in focus: Fairfax’s 60.72% stake acquisition explained; 10 factors investors need to know

The government and Life Insurance Corporation of India (LIC) will jointly retain a 34% stake in the restructured entity. The transaction involves the sale of a 30.48% stake held by the government and 30.24% held by LIC.

“Once completed, this will be the largest FDI in the financial sector of our economy so far,” the government said in a statement.

Here are 10 factors investors need to know

• Canadian billionaire Prem Watsa-led Fairfax will pay ₹81 per share, higher than the benchmark fair value of ₹75.99 determined by two independent valuation agencies, an official statement said.

• The deal—the largest in the banking space—marks a major milestone in a long-delayed effort to privatise IDBI Bank and reduce state ownership of commercial enterprises. The sale process began in 2022 and faced a setback earlier this year when initial bids fell below the government's reserve price.

• Finance Minister Nirmala Sitharaman termed the transaction a “milestone”, saying “having supported the bank’s recovery, we are now enabling its next phase of growth through the infusion of Foreign Direct Investment while retaining a minority stake.”

• The transaction still needs approval from the Reserve Bank of India (RBI), which will conduct a “fit and proper” assessment, as well as the Competition Commission of India (CCI) and other statutory authorities. Fairfax must present its credentials to the RBI and submit a roadmap for meeting the regulator's requirements before the sale can be finalised.

• Fairfax will get up to 15 years to comply with this condition, Department of Investment and Public Asset Management (DIPAM) Secretary Arunish Chawla said, adding that there will be a lock-in period of five years for the promoter. Also, Fairfax, which currently holds a 40% stake in Kerala-based CSB Bank, will have to either merge with IDBI or exit the South India-based lender.

• The new promoter will also have to retain the name, brand and customer relations for at least three years, he said. On employees, Chawla said they don't have to worry, and management transfer has been discussed with all stakeholders.

• LIC will also have to cut its stake from 19% in IDBI Bank to 15% in two years. Post completion of the transaction, which is likely before the end of FY27, the government will exit from the IDBI Bank board.

• The decision by the Cabinet Committee on Economic Affairs (CCEA) brings to a close a process that has stretched over five years, marking a significant step in the government’s efforts to reduce its ownership of state-run assets and attract private capital into the financial sector.

• The IDBI Bank stake sale was first announced in 2022 but was shelved in March after bids fell short of the government’s expected sale price.

• As of June 2026, the lender had total assets of ₹4.44 lakh crore. Its gross bad loan ratio stood at 2.3% as of June, down sharply from nearly 32% in September 2018. IDBI has more than 2,000 branches in India.

IDBI Bank share price details

On Wednesday, IDBI Bank shares settled at ₹90.39 apiece on the National Stock Exchange, gaining 8.98%. The development, however, came after the market hours.

From the beginning of the year, IDBI Bank shares have fallen 13%. On a year-on-year basis, the stock has slipped 1.5%, while for a five-year period it has surged nearly 45%.

According to NSE data, as of October 14, 2026, the private sector bank has a total market capitalisation of ₹97,190.96 crore.