Axis Bank surges as Essar repays loan

Axis Bank spiked up on Monday after Essar group announced that it has repaid all its dues to Indian banks including ICICI Bank and Axis Bank.

Essar Group's holding company Essar Global Fund Limited released a statement that said that it has repaid all overseas debt after it paid back the last tranche of Rs. 12,000 crore to its various lenders.

This loan repayment will help the group strengthen its creditability as they try to win back the ownership of Essar Steel, which is undergoing insolvency proceedings. The group company Essar Steel Asia Holding Limited (ESAHL) has offered Rs. 54,389 crore for Essar Steel's assets.

In 2008, Indian banks like ICICI Bank, Axis Bank and Standard Chartered Bank had given a loan facility of Rs. 31,500 crore to Essar group for its greenfield investment into sectors including mining, infrastructure and services.

On Monday, Axis Bank's shares reacted positively to this development, at closing Axis Bank was at Rs. 637.30 per share, up by Rs. 17.70 or 2.86 per cent, while ICICI Bank closed at Rs. 367.50 per share, up by 0.53 per cent. Nifty Bank closed at 27,300.15, up by 105.15 points or 0.39 per cent. While benchmark index Nifty50 closed at 10,776.60, up by 49.25 or 0.46 points and BSE Sensex closed at 35,850.16, up by 155.06 or 0.43 per cent.