Shares of state-run lender IDBI Bank surged 13% in intraday trade before closing nearly 10% higher on the BSE on reports that the Reserve Bank of India had begun evaluating bids from potential buyers who had expressed interest in acquiring a majority stake in the lender.

The benchmark S&P BSE Sensex closed 0.06% at 60,431, while IDBI Bank gained 9.6%. The stock was quoted at Rs 51.67 per share at the close.

“The Reserve Bank of India (RBI) has started assessing at least five potential bidders interested in acquiring a majority stake in state-owned IDBI Bank Ltd,” Reuters reported on Thursday.

The report named Kotak Mahindra Bank (up 1.35%), Prem Watsa-backed CSB Bank (down 0.07%) and Emirates NBD as potential bidders.

Meanwhile, Business Standard had earlier reported that the strategic sale of the government and state-owned Life Insurance Corporation of India (LIC)’s stake in IDBI Bank is expected to enter the second phase in Q1FY24.

The proposed IDBI stake sale is reported to be in two phases. First, an Expression of Interest (EOI) is invited, followed by a “fit and proper” evaluation and security clearance.

The second stage is to provide the qualified bidders with a Request for Proposal (RFP) document and further details of IDBI Bank so they can submit their financial bids on the terms stated in the RFP.

The government and Life Insurance Corporation (LIC) are selling a 60.72% stake in IDBI Bank, following a tender they had put out in October. The final date was set for December 16 but was later extended to January 7.

Under the deal, the government will own 15% of IDBI Bank and LIC 19%, bringing their combined holding to 34%.