SBI advanced further on Wednesday, following reports that the government has decided to exclude GDR holding from the ceiling of 20% for FIIs.

The stock of India's largest state-run commercial bank was among the biggest gainers in Sensex constituents, up 1.26% at Rs 313.40 by 11:30 IST. A substantial volume of over 681,000 shares was recorded on the counter. In the last 12 sessions, the stock rose by 14.42% from Rs 273.90 on 10 February 2003.

The rise in the State Bank of India stock was purely on reports that the government has agreed to exclude the Global Depository Receipt holding of 7.65% from the ceiling of 20% for foreign institutional investors in the state-run bank. Last week, the SBI stock had surged on the back of these rumours, but the government denied any such move.

Currently, the limit for FIIs in SBI stands exhausted as they hold a 19.63% stake (as per the shareholding pattern of the bank on 31 December 2002).

On Tuesday, there were reports that the government may raise the cap for FIIs in public sector banks to 49% from the current 20%. The announcement to this effect is likely to be made in the Union Budget 2003-04, which is scheduled on 28 February 2003, as per the reports.

Bank of Baroda (up 5.28% to Rs 77.75), Andhra Bank (up 4.70% to Rs 27.85), Bank of India (up 2.20% to Rs 37.15), PNB (up 1.95% to Rs 86.30), Union Bank (up 1.99% to Rs 25.65), Dena Bank (up 1.83% to Rs 13.90) and Oriental Bank of Commerce (up 2.13% to Rs 57.60) were the other major gainers among banks stocks, riding on the back of these reports.

For Q3 ended 31 December 2002, SBI had recorded a 28% growth in net profit to Rs 787.05 crore (Rs 7.87 billion). Net revenues jumped by 18% to Rs 3,756.93 crore (Rs 37.56 billion). For the nine months ended 31 December 2002, its net interest income recorded a 7% rise to Rs 7,210.20 crore (Rs 72.1 billion), mainly due to an increase in interest income by 4% to Rs 23,066.35 crore (Rs 230.66 billion). Net profit stood at Rs 2367.45 crore (Rs 23.67 billion), up 30%.

BSE code: 500112