Corp Bank Rs 304cr Ipo On Oct 3

Corporation Banks Rs 304-crore initial public offering will open for subscription on October 3. The bank is offering 3.80 crore equity shares of Rs 10 each at a premium of Rs 70 per share.

The Securities Exchange Board of India has cleared the draft offer document filed by the bank.

Of the 3.80 crore shares being offered, 19 lakh shares each are reserved for employees and non-resident Indians or overseas commercial bodies.

While 102 lakh shares are reserved for allotment for Indian financial institutions and banks the balance 240 lakh shares are being offered to the public. The bank's offer price of Rs 80 per share works out to a pre-issue price-earnings ratio of 5.24. The price-to-book value ratio works out to 1.6 based on the book value per share of Rs 48.72 as on March 31.

 

Net profit of the bank, in 1996-97, increased to Rs 125.13 crore from Rs 104.75 crore after making all the required provisions. It also succeeded in improving the interest spread as a percentage of average working funds to 4.21 per cent from 3.69 per cent in the previous year.

The bank has marked-to-market 83 per cent of its investments as against the minimum 50 per cent prescribed by the Reserve Bank of India.

As against the prescribed capital adequacy of eight per cent at the end of the last fiscal, the bank achieved a capital adequacy ratio of 11.3 per cent.

Corporation Bank recorded a growth of 13 per cent during the first quarter of the current fiscal, which works out to a gross profit of Rs 63.59 crore as against Rs 56.31 crore recorded during the corresponding period of the previous year.

The total business (total deposits plus advances) of the bank crossed the Rs 10,000-crore mark to touch Rs 10,363 crore as on June 30, registering a 6.7 per cent growth.

Cash management service products recorded a 30 per cent rise in turnover during the first quarter as compared with the corresponding period of the previous year.

Corporation Banks shares will be listed on Mangalore and Mumbai stock exchanges and the National Stock Exchange (NSE).

Investors will also have the choice of holding the shares in dematerialised form through National Securities and Depository Ltd.