PSU Banks' share continue to rally on privatisation buzz

Shares of state-run lenders extended their upward momentum on Friday with the Nifty PSU Bank index trading at an all-time high level, outperforming the benchmark indices.

The gains in the Nifty PSU Bank were led by Indian Overseas Bank, Bank of Maharashtra, Central Bank of India, Punjab National Bank, among others.

The shares of state-run lenders have been consistently gaining after the Union Budget announcement of privatizing 4 of these banks.

Nifty PSU Bank index has rallied 44 percent this month, over 49 percent so far in 2021 and almost 80 percent in last three month.

Meanwhile, media reports this week suggested that the government has shortlisted four mid-sized state-run banks for privatisation. The four banks on the shortlist are Bank of Maharashtra, Bank of India, Indian Overseas Bank and the Central Bank of India, the report added.

This led to a steep rise in the share prices of these banks.

PSU Banks in focus on privatisation buzz: Bank of Maharashtra, BoI jump 20%, up 40% in 2 days

However, government sources told CNBC-TV18, that the media report of the government shortlisting four mid-sized state-run banks for privatisation was not correct and the government is yet to identify PSBs for privatisation.

At 12:00 pm, the shares of Bank of India gained 2.36 percent to Rs 95.30, Bank of Maharashtra rallied 6.70 percent to Rs 26.90, Central Bank of India added 2.87 to Rs 24.73 apiece, while Indian Overseas Bank jumped 9.37 percent to Rs 20.78