Housing Development Finance Corporation (HDFC) is trading higher by over 2% at Rs 756, its highest level since October 2010, after the country’s largest housing finance company announces the successful conversion of warrants with equity shares.
In August 2009, HDFC had issued warrants - along with non-convertible debentures (NCDs) of Rs 10 lakh each - to qualified institutional buyers. The issue, comprising zero coupon NCDs aggregated to Rs 4,000 crore. Out of this Rs 2,000 crore NCDs were redeemed in August 2011 and the balance Rs 2,000 crore were redeemed on August 24 this year.
Pursuant to the exchange of the warrants, the Corporation issued and allotted 54.74 million equity shares of Rs 2 each and realised an amount of Rs 3,285 crore, representing 99.95% of the warrants issued, ,” HDFC said in a filing.
The proceeds of the said zero coupon NCDs were utilised to subscribe to the preferential allotment of equity shares offered by its sister concern HDFC Bank. The proceeds from the warrant exchange will be used to replace the zero coupon bonds and consequently the Corporation will not earn any additional interest income on the amounts raised, it added
The stock opened at Rs 736 and has seen a combined 2.09 million shares changing hands on the counter so far on both the exchanges.