Rekha Jhunjhunwala’s Big Bet: 2.3 Crore Shares in This Multibagger Bank Before Blackstone’s Entry
Veteran investor Rekha Jhunjhunwala, wife of the late Rakesh Jhunjhunwala, has made a strategic move by purchasing 2.3 crore shares in South Indian Bank (SIB)—just before private equity giant Blackstone announced a Rs 1,500 crore investment. The timing of her acquisition has sparked market excitement, with SIB’s stock surging 8% intraday.
Why South Indian Bank? A Midcap Multibagger
South Indian Bank (SIB), a Kerala-based private lender, has delivered 150% returns in the past year, making it a standout performer. Rekha Jhunjhunwala now holds 5.5% stake, reinforcing confidence in SIB’s growth.
Key Reasons Behind Rekha Jhunjhunwala’s Investment
- Turnaround Success: Under CEO Murali Ramakrishnan, SIB reduced gross NPAs to 4.47% (from 5.47% YoY) and reported a 67% jump in Q4 net profit.
- Digital Push & SME Focus: Strong South India presence aids retail and SME lending growth.
- Blackstone’s Backing: The PE firm’s 5.7% stake signals institutional trust and may boost M&A potential.
Blackstone’s Rs 1,500 Cr Investment: What It Means
- Capital Boost: Strengthens SIB’s balance sheet for expansion.
- Governance & Tech Upgrades: Could accelerate digital banking initiatives.
- Market Sentiment: Analysts see 20-30% upside in 12 months post-deal.
Should Retail Investors Follow?
Pros: Strong fundamentals, institutional backing, and low NPAs.
Cons: Midcap volatility, stretched valuations after the rally.
Verdict: A high-potential long-term bet, but short-term swings likely.
Conclusion
With Rekha Jhunjhunwala’s stake hike and Blackstone’s entry, South Indian Bank emerges as a top midcap banking pick for 2024.
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