HDFC Bank to raise Rs 4,200 cr

HDFC Bank proposes to raise Rs 4,200 crore through a mix of preference shares to its promoters and domestic and overseas equity issues.

The bank board, which met today, felt that additional capital is required to strengthen its capital base and fund growth plans.

While the bank is expected to tap the overseas market through a follow-on issue of American depository receipts to raise Rs 2,810 crore, preferential shares will be issued to promoter HDFC and its group companies to raise Rs 1,390 crore.

The latter will ensure that the promoter and promoter group's stake is maintained at 23 per cent of the enhanced share capital.

The bank reported loan growth of 30 per cent on March 31, 2007.

The bank proposes to make a preferential offer of 1,35,82,000 equity shares of Rs 10 each at an issue price of Rs 1023.49 per share.

Currently, HDFC and its group holds 21.56 per cent, out of which HDFC holds 12.17 per cent whereas rest lies with HDFC investments.

The other shareholders of the bank include institutions with FII (38.75 per cent), corporate and individuals including NRIs ( 20.8 per cent) and shares held by custodian of ADRs ( 18.89 per cent). The share price of the bank closed 0.23 per cent up at RS 1036.25 on Tuesday on BSE.

The bank had raised $ 300 million through ADR issue in January 2005 by issuing 7.6 million ADRs.