)
Housing Development Finance Corp (HDFC), the largest mortgage lender in the country, on Monday said its board of directors has approved fund-raising worth Rs 5,000 crore simultaneously by secured redeemable non-convertible debentures (NCDs) and warrants. The lender will seek its shareholders’ approval at the annual general meeting (AGM) scheduled for July 28.
The warrantholder will be entitled to exchange these with equity shares of HDFC at a premium and in line with present norms, the financier said in a notification to the exchanges.
“The maximum dilution that could take place in future, if all the warrants are exchanged into equity shares of the corporation, would be 2.2 per cent of the expanded equity share capital,” HDFC said. The NCDs and warrants will be issued to qualified institutional buys.
According to sources familiar with the development, the funds will be used for making provision for deferred tax liability (DTL), financing business growth and could also be used to increase or retain its current stake in HDFC Bank.
HDFC’s stake in the bank — the country’s second largest private sector bank — has fallen to 21.7 per cent from 22.5 per cent after the latter’s Qualified Institutional Placement.
HDFC will also have to make provision for DTL over the next three years — 25 per cent in the first two years and 50 per cent in the third year.
In line with the norms of the National Housing Bank, the regulator for home financiers, HDFC had to set aside Rs 120 crore as deferred tax liability during the January-March quarter and Rs 384 crore for 2014-15.
HDFC posted eight per cent year-on-year growth in standalone net profit for the March quarter at Rs 1,862.43 crore.
Its outstanding loan book grew 16 per cent in 2014-15 and stood at Rs 2.28 lakh crore compared with Rs 1.97 lakh crore as of March 2014, after taking into account those sold during the year.
The warrantholder will be entitled to exchange these with equity shares of HDFC at a premium and in line with present norms, the financier said in a notification to the exchanges.
“The maximum dilution that could take place in future, if all the warrants are exchanged into equity shares of the corporation, would be 2.2 per cent of the expanded equity share capital,” HDFC said. The NCDs and warrants will be issued to qualified institutional buys.
According to sources familiar with the development, the funds will be used for making provision for deferred tax liability (DTL), financing business growth and could also be used to increase or retain its current stake in HDFC Bank.
HDFC’s stake in the bank — the country’s second largest private sector bank — has fallen to 21.7 per cent from 22.5 per cent after the latter’s Qualified Institutional Placement.
HDFC will also have to make provision for DTL over the next three years — 25 per cent in the first two years and 50 per cent in the third year.
In line with the norms of the National Housing Bank, the regulator for home financiers, HDFC had to set aside Rs 120 crore as deferred tax liability during the January-March quarter and Rs 384 crore for 2014-15.
HDFC posted eight per cent year-on-year growth in standalone net profit for the March quarter at Rs 1,862.43 crore.
Its outstanding loan book grew 16 per cent in 2014-15 and stood at Rs 2.28 lakh crore compared with Rs 1.97 lakh crore as of March 2014, after taking into account those sold during the year.
