The funds raised will be used for growth as well as strengthening of the balance sheet.
Axis Bank has announced the floor price for its equity issue by qualified institutional placements (QIP) at Rs 661.50 per equity share, according to a release filed with the exchanges.
The funds raised will be used for growth as well as strengthening of the balance sheet. The release also said that the bank may, at its absolute discretion, may offer a discount of not more than 5 percent to the said floor price.
Reports stated that the bank is looking to raise between $ 1.5-2 billion (the equivalent of Rs 14,000 crore) via equity issuance. Foreign investors as well as domestic investors like mutual funds, etc. have shown an inclination to participate in the issue. Existing promoters like LIC & GIC could also participate in order to maintain their stake.
A report noted that taking last two week’s average price, the equity dilution can be between 4.6-8.6 percent, while the book value can increase between 2-7 percent and the Tier I capitalization of the bank can strengthen by 1.2 percent-2.3 percent.