DCB Bank share price had declined over 30 per cent in the past three trading sessions after the initial announcement. (Express Photo)
DCB Bank share price surged as much as 7.09 per cent intraday on Friday after the bank informed BSE before market hours that it has decided to install over 150 branches over a period of 24 months instead of 12 months earlier – this happened after the management came in for much criticism from analysts and shareholders over its intention to expand in a major way.
DCB Bank share price had declined over 30 per cent in the past three trading sessions after the initial announcement.
The lender’s aggressive expansion plan had spooked investors on fears that it will dent return ratios. In the wake of the criticism, in a BSE filing today, DCB Bank said, “We recently announced our intention to install over 150 additional branches within 12 months so as to have more than 300 branches by December 2016. Post the announcement we have received feedback on our branch expansion plans from investors, analysts and other stakeholders. In view of the feedback received, and in close consultation with the chairman, the management team has decided to install branches in a cautious, prudent and calibrated manner over a period of 24 months (instead of 12 months).
According to the release, the management team will work out the financial estimate for the revised branches roll out approach in the next two weeks or so.
At 12.23 pm, the share price of DCB Bank was up 5.36 per cent at Rs 97.30. The scrip opened at Rs 95.80 and had touched a high and low of Rs 98.90 and Rs 95.10, respectively, in trade so far. Sensex was down 82 points at 26,928.
For the quarter ended September 2015, the bank posted net profit of Rs 36.93 crore, down 10.12 per cent, against Rs 41.09 crore in the corresponding quarter a year ago.
DCB Bank (formerly Development Credit Bank) is a modern emerging new generation private sector bank with 160 branches across 17 states and 2 union territories.
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