ICICI Bank is looking to raise around Rs 20,000 crore by selling six-to-seven percent stake to institutional investors and has approached at least 10 investment banks for the same, reports Mint.
The country's largest private-sector lender plans to complete the entire raise in a single tranche and may soon issue formal mandates to some of the investment banks it approached, sources told the paper.
The move, which would be the largest such capital raise in India, is aimed at subverting liquidity squeeze created in the sector after the IL&FS debacle and subsequent busts.
The qualified institutional placement (QIP) way was zeroed in on after the bank dropped plans to issue American depositary receipts (ADRs), the source said.
Moneycontrol could not independently verify the report.
This is also being seen as an opportunity for banks to gain back market share from non-banking financial institutions (NBFCs) in the infrastructure sector, the report said.
"If the bank is able to raise this money, they should use the opportunity to do so and use the capital in phases," the paper quoted a Mumbai-based banking analyst as saying.
If the fund raising goes through, ICICI Bank would be following in the footsteps of multiple private-sector lenders that have already bettered or are considering improving their growth capital via QIPs.
Yes Bank recently announced plans to raise $1.2 billion this fiscal, Axis Bank raised Rs 12,500 crore in September and public lender State Bank of India (SBI) raised Rs 15,000 crore in what was then the country’s largest QIP in 2017.
QIPs allows listed companies to raise capital, without the attached burden of submitting legal paperwork to market regulators.
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