Sharemasterindia.com: Shares of Kotak Mahindra Bank fell on Tuesday after an inter-ministerial panel deferred decision for the second time on the bank's proposal for raising foreign investment limit.
The Foreign Investment Promotion Board (FIPB) had taken up the application in its meeting on Monday, but the decision was deferred, Press Trust of India said, citing sources. Earlier, the board had deferred decision on the proposal in its meeting held on April 30.
Kotak is seeking FIPB approval to raise the aggregate foreign investment limit to 55 per cent. The Reserve Bank has barred overseas investments in the private sector lender, after foreign shareholding hit the threshold following merger of ING Vysya Bank with Kotak Bank.
Investments from foreign investors had reached 48.55 per cent in the merged entity.
FIPB is a single window clearance system for proposals on FDI. India allows FDI in most of the sectors through automatic route, but in certain segments considered sensitive for the economy and security, the proposals have to be first cleared by FIPB.
As of 10:06 a.m., shares of Kotak Mahindra Bank fell 1.40 per cent as compared to a 0.80 per cent decline in Bank Nifty.
