The market has welcomed RBI's intention of a lower interest rate regime followed by the Union Budget which is expected to prop up economic growth. This has seemingly changed the market perception of these stocks which were trading at their all-time lows. In fact, after the bank rate cut, a number of banks have started reducing their deposit rates and this is expected to improve their spread. This is a much awaited measure as these banks are hit by slower credit growth due to the falling industrial demand.

Banks like Dena Bank, City UnionBank, UTI Bank, Jammu & Kashmir Bank and South Indian Bank have seen sharp rise in prices on Wednesday. On Wednesday, South Indian Bank zoomed by 24.5 per cent from Rs 16.5 to Rs 20.55. After hitting its all-time low of Rs 12.5 in February, the stock has been rising continuously and gained 64 per cent in the past eight trading sessions. The volumes, too, shot up to 3300 shares against the previous trading day volume of 400. However, the stock is still trading below its offer price of Rs 35.Dena Bank also shot up by 24.18 per cent on Wednesday from Rs 12.2 on March 1 to Rs 15.15 (volumes 51,200 shares) on March 3. The stock is still trading at a 50 per cent discount to the offer price of Rs 30. Another prominent gainer is City Union Bank which rose by 12.5 per cent on Wednesday from Rs 16 to Rs 18. The stock has gained 50 per cent in the past seven trading sessions. Another private sector bank, UTI Bank has also risen by 23.59 per cent from Rs 14.2 to Rs 17.55. Volumes, too, rose from 1000 shares to 20,500.The bank had offered the shares at an offer price of Rs 21. Jammu & Kashmir Bank also rose by 6.5 per cent on Wednesday from Rs 23 to Rs 24.5. State Bank of Bikaner and Jaipur has risen by 8 per cent on Wednesday from Rs 226 (volumes 10 shares) to Rs 244 (110). In the past seven trading, State Bank of Travancore has gained 17 per cent from Rs 205 to Rs 240.