Shares of private sector lender Kotak Mahindra Bank dropped nearly 4% in early deals on Thursday amid report that Canada Pension Plan Investment Board (CPPIB) plans to sell up to 2.02% stake in the bank today. The Canadian asset management company is likely to offload 40 million shares at a price band of ₹1,681.26-1,769.75.

At the upper price band, CPPIB is expected to raise ₹7,079 crore from the stake sale. The Canadian pension fund held 6.37% shares in Kotak Mahindra Bank at the end of December 2021 quarter.

Reacting to the news, Kotak Mahindra Bank shares opened 3.05% lower at ₹1,714 on the BSE against previous closing price of ₹1,767.95. In the opening trade so far, the stock declined as much as 3.9% to hit a low of ₹1,699.05. It has fallen 5.7% in the last two sessions and 4.7% in a week.

At 10:00 AM, shares of Kotak Mahindra Bank were down 3.07% at ₹1,713.70 on the BSE. Meanwhile, the BSE benchmark Sensex was trading flat at 57,686 levels.

Since the beginning of the calendar year 2022, Kotak Mahindra Bank has delivered a negative return of 6%, while it dropped 15% over six month period. In the last one year, the bank’s share fell 4%, while it rose 28% in three years and 95% over past five years.

In a separate development, Uday Kotak-led bank has invested ₹10 crore to acquire 7.84% equity stake in Open Network for Digital Commerce (ONDC), an open-source e-commerce platform. “Kotak Mahindra Bank has subscribed to 10,00,000 equity shares of Open Network for Digital Commerce (ONDC) for a consideration of ₹10,00,00,000, translating into an equity shareholding of 7.84% in ONDC as on March 22, 2022,” it said in a filing to the BSE on March 23.

“The bank wishes to participate in the creation of infrastructure to develop and transform the Indian digital commerce ecosystem and has therefore made the investment in ONDC,” it added.

Kotak Mahindra Bank is the third Indian bank to acquire an equity stake in the government-backed private sector non-profit company. On Tuesday, State Bank of India (SBI), the country’s largest lender, subscribed to 10 lakh equity shares of ONDC of the face value of ₹100 each to acquire 7.84% shareholding in ONDC. In November last year, Punjab National Bank (PNB) had proposed to invest as a promoter in ONDC by picking up a 9.5% stake in the company.

Established on December 30, 2021, ONDC is a first of its kind initiative of the Department for Promotion of Industry and Internal Trade (DPIIT), under the ministry of commerce and industry, to democratise digital commerce, moving it from a platform-centric model to an open-network platform. The government-backed platform intends to increase the ease of doing business online and to expand alternatives for both buyers and sellers to engage in the digital commerce space.

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