RBL's gains augur well for other financial services firms including ICICI Prudential Life Insurance Co Ltd and PNB Housing Finance Ltd that are expected to list this year.
The stock of private sector lenders such as HDFC Bank Ltd have surged this year as they gain market share from state-run rivals that are struggling under the weight of Rs 8,046 lakh crore in distressed loans.
The gains by RBL also come as strong stock markets in India have sparked a boom in initial public offerings (IPOs), with 2016 expected to be best year for IPOs in six.
"We are positive that the bank will ... use proceeds and internal cash generation to expand geographical region network," said Gaurang Shah, vice president at Geojit BNP Paribas Financial Services, adding he did not expect any distress in RBL's asset quality.
RBL's shares rose to a high of Rs 305.50, compared with the IPO price of Rs 225. By 12:24 p.m., they were trading 31.9 percent higher at Rs 296.70.
Its IPO last week had been subscribed nearly 70 over, raising about Rs 1,220 crore from the sale of new stock as well as stakes held by some of its shareholders.
The 73-year old lender has been on an upward trajectory since 2010 when a new management led by former Bank of America executive Vishwavir Ahuja expanded it outside its home base in Maharashtra.
Private sector lenders are expected to benefit from the authorities' push to expand banking services across a country with a population of around 1.25 billion.
The Reserve Bank of India last year issued two new banking licenses and is creating permits for so-called payments banks and small finance banks, niche lenders that can service the less affluent.
Shares in micro lender Ujjivan Financial Services Ltd, which is setting up a small finance bank, have more than doubled in price since making their market debut in May.
Equitas Holdings Ltd, another small finance bank permit holder, has surged more than 60 percent from its IPO price in April.
($1 = 67.0500 rupees)
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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