Punjab National Bank slips 8%, falls below QIP floor price of Rs 37.35

PNB said the committee will meet on Friday to consider and determine the issue price for the equity shares, including a discount, if any, to be allotted to QIBs

Shares of Punjab National Bank (PNB) slipped 8 per cent to Rs 37.25 on the BSE on Wednesday, falling 10 per cent in the past two trading days after the bank announced the opening of qualified institutional placement (QIP) issue on Tuesday. However, the share price of the state-owned lender has fallen below the QIP floor price of Rs 37.35 per share.

In the past month, the stock has run up strongly, rallying nearly 40 per cent till Monday. At 09:44 am, the stock was trading 6 per cent lower at Rs 38.15, as compared to 0.71 per cent rise in the S&P BSE Sensex. The counter has seen huge trading volumes, with a combined 87 million equity shares were changing hands on the NSE and BSE.

The Capital Raising Committee of the bank, at a meeting held on Tuesday, authorised the opening of the QIP issue and approved the floor price at Rs 37.35 per equity share, PNB said in a regulatory filing. The bank has taken approval for raising Rs 7,000 crore through QIP route this fiscal.

The bank may at its discretion offer a discount of not more than 5 per cent on the floor price, it said. PNB said the committee will meet on Friday to consider and determine the issue price for the equity shares, including a discount, if any, to be allotted to Qualified Institutional Buyers, pursuant to the QIP.

PNB in preliminary placement document said that the Bank intends to utilize the net proceeds towards augmenting Bank’s Tier I Capital to meet the Basel III and to support growth plans and to enhance the business of Bank.