HDFC Bank today said it plans to raise up to Rs 24,000 crore through a preferential issue of shares to promoter HDFC as also share issuance and depository receipts.
"The board of directors of the bank, at their meeting held on December 20, 2017, has approved raising of funds aggregating up to Rs 24,000 crore," the country's second largest private sector lender said in a regulatory filing to the stock exchanges.
An amount of up to Rs 8,500 crore will be raised through issuance of equity shares pursuant to a preferential issue to Housing Development Finance Corporation (HDFC).
The balance amount of about Rs 15,500 crore will be raised through issuance of shares, convertible securities, depository receipts pursuant to a qualified institutional placement (QIP)/American Depository Receipts (ADR)/Global Depository Receipts (GDR), it said.
HDFC Bank will seek approval of its shareholders in an extraordinary general meeting of the bank on January 19, 2018.
Yesterday, mortgage lender HDFC Ltd had announced a Rs 13,000-crore fund raising plan to be ploughed primarily into maintaining its holding in its banking arm and enter newer segments like stressed assets and health insurance.
This will be the first equity raising by the country's largest mortgage lender in a decade and bulk of this will be used to maintain the parent's stake in HDFC Bank at 21 per cent in an upcoming fund raising round.
Since the mortgage lender did not participate in the Rs 9,800-crore QIP issue of HDFC Bank in February 2015, the shareholding came down to 21.01 per cent from around 24 per cent then.
The HDFC Bank announcement comes within a month of bad- loans saddled Axis Bank announcing an over Rs 11,626 crore capital raise from private equity major Bain Capital and promoter LIC, which was completed recently.
HDFC Bank raised about Rs 10,000 crore in 2015 by selling American Depository Receipts and India-listed shares to qualified institutional investors.
As per a US Securities and Exchange Commission filing, the company has raised USD 1,270.72 million (about Rs 8,000 crore) by issuing 22 million ADS to global investors.
Besides, the bank has raised about Rs 2,000 crore from a QIP in the domestic market.
The issue price for QIP was Rs 1,067 per share. The bank used proceeds for enhancing solvency and capital adequacy ratio and general corporate purposes.
The stock of HDFC Bank closed at Rs 1868.05 per unit, down 0.91 per cent on the BSE.
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