Federal Bank approves Rs 6,200 crore warrant issue to Blackstone; stock up 2%

Core Insights - Blackstone is set to acquire a nearly 10% stake in Federal Bank, pending shareholder approval, marking a significant private equity investment in mid-sized Indian lenders this year [1][6] - Federal Bank's board has approved the issuance of 27.29 crore convertible warrants at Rs 227 each, aligning with the recent closing price [1][6] - Blackstone will initially pay 25% of the warrant price, with the remaining 75% due upon exercising the warrants, leading to a 9.99% stake and the right to nominate one non-executive director [2][6] Financial Metrics - Federal Bank reported a Capital to Risk-weighted Assets Ratio of 15.71% and a Tier-1 capital ratio of 14.37%, both exceeding regulatory requirements [6] - The bank's credit-deposit ratio is at 84.7%, indicating a solid capital position [6] Market Performance - Federal Bank shares have increased by 18.5% over the past month and are up 14% year-to-date, reflecting strong market momentum [6] - The stock is trading above all eight key simple moving averages, indicating bullish trends [6] - The Relative Strength Index is at 80, suggesting the stock is in overbought territory, while the Moving Average Convergence Divergence at 7.7 supports the positive trend [6]