Citi’s India Divestment Plan Takes Shape

Citigroup (C) has agreed to sell off its consumer businesses in India to Axis Bank Limited in an all-cash deal worth $1.6 billion. The announcement is a part of Citi’s plans to exit from its consumer banking franchises in 13 markets across Asia and EMEA.

New York-based Citigroup is a financial services holding company. Shares of Citi have tanked 9.8% so far this year.

As per the agreed terms, Citi will be selling all its credit cards, retail banking, wealth management and consumer loans businesses to Axis Bank. Further, the sale comprises Citi’s non-banking financial company, Citicorp Finance (India) Limited.

Citi plans to keep its institutional client businesses in India and continue to serve them.

Upon completion, about 3,600 Citi employees, working in its consumer business, will be transferred to Axis Bank as part of the deal.

Further, the deal is expected to release about $800 million of allocated tangible common equity. Citi expects the transaction to close in the first half of 2023.

Citigroup Earnings

The company is expected to report EPS of $1.84 for Q1 2022 on April 14. Citigroup stock earnings beat estimates in three quarters of 2020 and all in 2021. Given the impressive earnings history, Citi will likely beat estimates again in Q1.

Overall, the Street is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on nine Buys, nine Holds and one Sell.

Insider Trading

Based on recent corporate insider activity, sentiments seem very negative. This means that over the past quarter there has been an increase in insiders selling their shares of Citigroup.

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