HDFC Bank issues ADR at discount

HDFC Bank has priced its follow-on American depository receipt (ADR) issue at a discount of about 0.41 per cent at $92.10 per share to its previous close of $92.64.

The price fixed is, however, equivalent to Rs 1,235.06 per equity share, which is a premium of 3 per cent to over the July 17, 2007 closing price on the National Stock Exchange.

Each ADR is equal to three local shares. The bank raised close to $607 million through the issue. The fund will be used to support the bank's future growth plan.

The underwriters to the offering have the right to purchase up to an additional 989,176 ADSs at the public offering price to cover over allotments.

Credit Suisse Group, JPMorgan Chase & Co., Merrill Lynch & Co., Morgan Stanley, Nomura Holdings Inc., UBS AG and Deutsche Bank Securities were the lead managers to the issue.

The ADR was a part of the bank's about Rs 4,200 crore capital raising plan. The bank had raised Rs 1,390 crore through a preferential allotment to the Housing Development Finance Corporation.