Rajeev Jain, CEO, Bajaj Finance, says that the company plans to raise Rs 750 crore, which will take care of our growth needs for the next 2.5-3 years and we will be well capitalized to fund our growth.
Also read: Bajaj Finance up 4% on rights issue buzz
Below is the edited transcript of his interview to CNBC-TV18. Q: What is the size of the rights issue and at what is the pricing of the issue?
A: We have filed a Draft Letter of Offer to raise Rs 750 crore via rights issue. The pricing will be a function once we get a Draft Letter of Offer approved after that the board will take a decision. So, there is time for pricing but we plan to raise Rs 750 crore, which will take care of our growth needs for the next 2.5-3 years and we will be well capitalized to fund our growth. Q: Why is there a need to raise this capital, is it just growth capital and did you toy with other options like doing a QIP or any other equity instrument other than rights?
A: Currently, our tier I is around 14.4 percent. The RBI has mandated us to maintain 12 percent; we are comfortably maintaining around 14 percent. So, we are raising capital. On rights, the current promoter shareholders are very comfortable with the growth plans and growth of the company. In last two years the promoters have raised their stake from 51 percent to now 62 percent. They continue to remain excited about our growth prospects so we chose to do rights issue. Q: How much dilution with Rs 750 crore rights?
A: It will depend on the overall pricing.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
