Shares of Punjab National Bank (PNB) hit a new 52-week high in morning trade on November 25 after the bank announced it had received approval from the Government of India to sell a stake in UTI Asset Management.

“The exchange has now been informed that the bank has received approval from the Ministry of Finance, DIPAM, to divest all/part of the equity interest in UTI AMC in batches or batches as per SEBI’s regulations,” PNB said in a filing to the exchange. Indicates Thursday time.

Shares of PNB were up 6% at 9:30 am on the National Stock Exchange (NSE), hitting a new high of Rs 53.90 a share. UTI AMC stock also jumped 6.53% on the back of this development. The stock was quoted at Rs 733 on the NSE.

As of today, PNB holds a 15.22% stake in UTI AMC. The public sector lender said the stake sale was aimed at realising investment income.

The timeline and value of the divestment have yet to be determined. UTI AMC was launched by four promoters – State Bank of India, Life Insurance Corporation of India, Bank of Baroda and Punjab National Bank – holding a 45.16% stake in UTI AMC.

In Q2FY23, PNB reported a 63% drop in its stand-alone net profit to Rs 411 crore due to higher non-performing loan provisions. The bank posted a net profit of Rs 1,105 crore in the same period last year.

The state-owned lender’s net interest income rose 30.2% to Rs 8,271 crore in the quarter compared to last year’s period. Emkay Global has a sell rating of Rs 30 per share, even though the stock is up 42% in 2022.

“The bank reported weak profitability mainly due to higher reserves it looked to underpin PCR. Asset quality continued to improve on the back of improved recovery/write-offs, although still below average compared to peers,” it said.